IMAP Annual Review 2023 and M&A Outlook 2024

Global Results

IMAP closed 231 M&A transactions worth over $9 billion in 2023.

Mid-market M&A activity was down globally in 2023 but continued to outperform the broader M&A market. IMAP partners registered a strong performance in 2023 with an uptick of activity in the second half of the year as expectations of a recession waned with reduced inflationary pressure and interest rates normalising.

Key M&A highlights from our international IMAP partners include: 

  • Succession was a major source of transaction activity, followed by horizontal consolidation and owners seeking liquidity opportunities. 

  •  Appetite from banks and debt funds to finance deals showed signs of returning in late 2023, albeit with persistent scrutiny on business models and cash flows. 

  •  Mismatched valuation expectations proved to be a hindrance to deal closings  but this has led to the formulation of creative earn-out solutions by our dealmakers to bridge these valuation gaps.

  • Private Equity firms postponed many exits due to lower valuations. The record amounts of unspent private capital continuing to build on the sidelines combined with public companies’ strong balance sheets could lead to an uptick in transaction activity in 2024.

Ireland and UK

In Ireland for M&A activity in Q1 2024, Richard Tunney, Managing Director, Corporate Finance at Key Capital, remains optimistic.

"The second half of 2023 demonstrated an increase in deal volume and we are optimistic about Irish M&A activity continuing that trend into 2024. With a third of IMAP’s 231 deals reported as cross-border, identifying potential buyers and partners globally is crucial to providing solutions for Irish businesses looking to sell their businesses or raise capital this year."
Richard Tunney, Key Capital

The UK market saw a significant fall in aggregate deal value in 2023 (over 50% in H1) largely driven by a lack of mega-deals, UK mid-market M&A volume remained comparatively resilient. The notable exception were private equity exits which were subdued due to lower valuations driven by the highest interest rates in over a decade. As we enter 2024 we anticipate an acceleration in deal activity driven by two key factors. First, markets are beginning to price in interest rate cuts as the inflation rate starts to come down. This will enhance debt availability and will likely see valuations start gradually ticking up and PE activity accelerate. However, we see the pace of interest rate cuts in the UK considerably lagging behind the US. Second, the UK is entering an election year with a near certainty of an incoming Labour government.

“Whilst Labour has notably not committed to raising Capital Gains Tax, there is a lingering fear that this may be on the longer-term agenda which has historically always accelerated exit planning in the mid-market.”
Karri Vuori, Managing Partner, IMAP UK

Read the full Annual Review 2023 report below, including IMAP partner global M&A perspectives and forecasts for 2024.

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