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2024-2025 Global M&A Trends: Insights from Capstone Partners & IMAP

In a recent release by Capstone Partners, in collaboration with IMAP, crucial trends and insights into the global mergers and acquisitions (M&A) landscape have been unveiled. The 2024-2025 Trends in Global M&A Research Survey highlights significant findings from M&A advisors across the globe and offers a forward-looking perspective on the activity expected in the coming year. Conducted between September 19 and November 5, 2024, this survey reflects the insights of 100 IMAP M&A advisors from 54 countries, capturing critical sentiment surrounding the current economic environment and expected deal-making conditions.

Economic Sentiment Improving

One of the key takeaways from this research is the optimistic outlook among advisors regarding the economy. With central banks initiating interest rate cuts, only 38% of surveyed investment bankers anticipate a recession to be probable in 2025; this marks a significant decline from previous years—down 22% year-over-year (YOY) and 40.2% compared to 2023. This positive economic backdrop is expected to bolster M&A activity in the middle market.

Rising Deal Flow Anticipated

Surveyed advisors indicated that 79% expect an increase in deal flow for 2025, a notable rise of 28% YOY. This follows what many believe to be a trough in M&A activity in 2024. The middle market continues to demonstrate resilience, with 88% of investment bankers confirming that its performance is either in line with or surpasses the broader market.

Private Equity Activity on the Upswing

The sentiment towards private equity activity is notably buoyant, with over half (51%) of advisors anticipating a surge in sponsor deal-making. As buyers become more discerning, the characteristics sought in potential acquisitions have evolved. A striking 69% of respondents highlighted recurring revenue as the most critical attribute for acquirers in 2024, an increase from prior surveys.

Valuations and Industry Trends

Looking forward to 2025, M&A purchase multiples are projected to experience a moderate increase, with 46% of advisors predicting rising valuations. Certain industries are expected to lead in this trend, most notably Financial Technology Services and Healthcare, which are forecasted to continue yielding the highest average M&A EBITDA multiples.

Motivations Behind Transactions

In 2024, a significant 54% of advisors noted that business owner retirement drove sell-side transactions. As we move into 2025, industry consolidation is anticipated to be the primary motivator for sellers, reflecting the expected strong M&A volume that year.

Importance of Realistic Valuations

For sellers aiming to succeed in their M&A endeavors, nearly all advisors (97%) emphasized the importance of establishing realistic deal valuations. This sentiment aligns with the challenges faced in 2024, where 60% of advisors reported that sellers' inflated valuation expectations hindered deal closures.

This comprehensive study by Capstone Partners and IMAP highlights critical factors influencing the global M&A landscape and outlines the expectations for the year ahead. As we delve deeper into 2025, navigating the challenges and opportunities presented by the M&A market will require acute awareness of the ongoing trends and shifts in economic sentiment.

For detailed insights, including data segmented by sector and region, the full report is accessible through Capstone Partners.

About Capstone Partners

With over two decades of experience in middle market investment banking, Capstone Partners specializes in offering a full range of tailored financial advisory services. Their expertise spans M&A advisory, corporate restructuring, and much more. Headquartered in Boston, the firm boasts a team of more than 175 professionals across multiple U.S. offices. For more information, please visit Capstone Partners.

About IMAP

IMAP is recognized as a leading international mergers and acquisitions partnership, closing over 2,200 transactions in the past decade alone. With a presence in 51 countries, IMAP consistently ranks among the top M&A advisors for mid-market transactions worldwide. To learn more, visit IMAP.