11 Jan, 2024 Global deal activity shrinks by 24.5% in 2023, reveals GlobalData
Posted in Business Fundamentals- Deal volume down by 24.5% in 2023
- All deal types under coverage suffered setback
- Deal making was notably down for PE/VC firms
Grappled with several challenges and uncertainties, 2023 remained a disappointing year for deal activity with a massive drop in volume. A total of 52,534 deals (mergers & acquisitions (M&A), private equity (PE) and venture capital (VC)) were announced globally during 2023, a decline of 24.5% compared to the announcement of 69,606 deals during the previous year, according to GlobalData, a leading data and analytics company.
Aurojyoti Bose, Lead Analyst at GlobalData, comments: “Several macroeconomic challenges and uncertainties created volatile market conditions throughout 2023. The year began with a cautious outlook and the dent in dealmaking sentiments continued to prevail throughout on the back of the ongoing geopolitical tensions, inflation, hike in interest rates, and recession fears.”
An analysis of GlobalData’s Deals Database reveals a drop in volume for all the deal types under coverage during 2023 compared to 2022. The trend was alike across all the regions and key markets.
Bose adds: “While all the deal types suffered setback during the year, deal making was notably down for PE/VC firms.”
For instance, the number of M&A deals fell by 17.2%, whereas the volume of private equity and venture financing deals declined by 28.3% and 33.6%, respectively, during 2023 compared to the previous year.
North America, which holds the lion’s share in global deal activity, registered a considerable decline of 29.2% in volume during 2023. Europe, Asia-Pacific, Middle East and Africa and South and Central American regions also witnessed respective deals volume fall by 20.4%, 20.4%, 25.5% and 31.3% in 2023 compared to the previous year.
Meanwhile, key markets including the US, China, the UK, India, Canada, Japan, Germany, Australia, France and South Korea witnessed a decline in deals volume by 30.9%, 16%, 15.2%, 26.1%, 13%, 15.9%, 19.7%, 22.4%, 18.5% and 30%, respectively, in 2023 compared to 2022.
