‘The biggest issue for the market is uncertainty’, says Richard Youle, who has headed Skadden’s London office since July. ‘Whether that’s in relation to the current geopolitical landscape, higher interest rates, inflation, or navigating tougher stances by regulators – we’re seeing people take longer to think about transactions and execute them. There’s also a mismatch of expectations – sellers are looking for 2022 prices, while buyers are looking for a reduction.’
Indeed, this view is borne out by the data. According to Refinitiv, worldwide M&A activity for the first three quarters of 2023 is down 27% compared to the same period last year, to a ten-year low of $2trn. There are some positive signs. Q3 2023 saw activity dip 16% on Q2. But four of Refinitiv’s top ten highest-value global deals were announced between June and September, and the months since then have seen further high-value activity. Still, these points notwithstanding, Q3 2023 remains the slowest Q3 since 2012.
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