The past half year has been one of shock and awe as the COVID-19 pandemic and subsequent lockdowns spread fear and uncertainty, developments that have taken a dreadful toll on M&A. Indeed, almost half of dealmakers say they are not currently considering M&A, however, the majority (70%) say they may return to the market within the year depending on how the pandemic plays out. Regardless of investment intentions, dealmakers recognise the current uncertainty as a short-term obstacle, highlighting Australia’s many advantages, particularly within the mid-market, as features of the deal environment that will not be shaken by the present panic.

This report explores the current trends and challenges shaping the Australian mid-market M&A market in addition to the main drivers behind cross-border deals and key markets where opportunities can be found.

Key findings include:

• Pandemic shapes M&A intentions: 42% of dealmakers are considering M&A into the Australian mid-market, while 11% remain unsure of their next move due to the ongoing pandemic.
• A promising year ahead: 70% say they may return to the Australian market within the next 12 months depending on how the pandemic and health crisis play out.
• Recession on the horizon? 57% anticipate a recession in Australia, compared to 90% who say a global recession is imminent.
• Private equity will drive deals: 95% say the amount of capital to be deployed by private equity will be the top mid-market deal driver, and 12% say PE deals will increase in the year ahead.

Mergermarket is pleased to present Dealmakers: Mid-market M&A in Australia mid-year update, published in association with Pitcher Partners.