2023 Mergers and Acquisitions Outlook Survey

The results of Dykema's 2023 Mergers & Acquisitions Outlook Survey are in! This annual survey tracks the marketplace to gauge the direction of the M&A market and economy for the coming year.

As with previous installments of the survey, Dykema canvassed senior executives and advisors in the M&A space to ask them to share their observations and insights on how the U.S. economy, political environment, and emerging trends will impact the M&A market in the year to come. Facing inflation, potential recession, and geopolitical uncertainty, business leaders anticipate tempered deal activity over the coming year. 

While dealmakers recognize that deal flow will not return to the frenetic pace of 2022, most expect the U.S. M&A market to improve over the next 12 months. Many respondents remain optimistic about the broader U.S. economy, and one-third anticipate no change—nearly double the amount from last year’s survey. Overall, dealmakers are expecting last year’s economic headwinds to persist into 2024—and that little else will change.

When it comes to AI, three in four dealmakers believe the technology will have a meaningful impact on M&A processes and efficiencies. Respondents believe investment in automation and AI is one of the top three trends driving M&A activity across multiple sectors, including financial services, healthcare, and manufacturing. Even so, dealmakers must overcome the ethical and cybersecurity concerns related to AI’s incorporation into the M&A process.

Other significant findings in the report include:

• Almost half of dealmakers say third-party equity investments have become more common, and nine in 10 have worked on deals involving seller financing within the past year.
• According to respondents, the top three factors likely to spur M&A activity in 2024 are improved financial markets, availability of capital, and inflation moderation.
• Close to three-quarters of dealmakers say it is likely they’ll be involved in a transaction in which the buyer or target company is screened for ESG risk.

• Seventy-one percent of M&A dealmakers anticipate acquiring companies offering AI capabilities, or those that successfully implement AI solutions in their businesses, in the next year
• Respondents anticipate the energy, financial services, and healthcare sectors to see the highest volume of M&A activity in the next 12 months. As compared to 2022:
  • Energy and financial services swapped spots as 1st and 2nd, respectively.
  • Healthcare rose from 4th to 3rd.
  • Cannabis fell from 5th to 8th.
  • Automotive plummeted from 3rd to 10th, after five years as a top-three sector.

The full report is available here.