‘Turbocharged’ M&A market could hit a record $6 trillion by year end, says KPMG

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Deal-making activities worldwide could hit a record $6 trillion by the end of the year as businesses continue to embrace cheap financing and the pandemic recovery, KPMG has said.

Global mergers and acquisition volumes have so far surpassed $4.3 trillion this year, according to Refinitiv data, moving closer to the all-time high of $4.8 trillion set in 2015.

It marks a surge from a total of $3.6 trillion reached in 2020. With “pent-up energy” from pre-pandemic fundraising still in full swing, Stephen Bates, KPMG partner and head of transactions for Singapore, said he sees no sign of it slowing down.

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The M&A market is absolutely turbocharged at the moment.

Stephen Bates

partner and head of transactions (Singapore), KPMG

“The M&A market is absolutely turbocharged at the moment,” Bates told CNBC’s “Street Signs Asia” Friday.

“There’s a lot of pent-up energy from the fundraising [in 2018 and 2019] that didn’t happen last year. That dry powder is now being deployed,” he said.

Corporates, private equity and SPACs lead the charge

As that momentum still continues, I think we’ll see that flow into the first quarter of next year.

Stephen Bates

partner and head of transactions (Singapore), KPMG

“We’re in a fairly low-growth environment and that means CEOs are looking to other markets to grow products, markets and capability,” said Bates.

That trend is set to continue until the end of the year, when deals could hit “nearly the $6 trillion mark,” and perhaps into early 2022, said Bates.

“With interest rates staying low, the positive sentiment still there … I think as that momentum [will] continue. I think we’ll see that flow into the first quarter of next year,” said Bates.



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