• Mon, Apr 01, 2024
  • Key Takeaways: Top Eight Trends in Lower-Middle-Market M&A
  • Eric_j_gall
  • Click here to link to the full article published in PriceofBusiness.com on December 14, 2023, based on an interview with Eric J. Gall.

    Key Takeaways from the Article

    M&A history:

    • Lower-middle-market M&A peaked in 2021 and 2022.
    • Belts tightened in 2023.

    Top eight lower-middle-market M&A trends for 2024 to 2027:

    1. Healthcare Roll-ups: Medical and dental roll-ups are still strong.  Consolidation is expected to continue.

    2. Digital Revolution: The acquisition of software developers and digital, data, and AI service providers is expected to increase.

    3. Remote Connection: The acquisition of digital communication providers is expected to increase.

    4. Private Equity Activity: Private equity accumulated a respectable amount of liquid capital in 2023 and is expected to continue the pursuit of recession-resistant opportunities, e.g., healthcare, energy, food & beverage, pharmaceuticals, and maintenance & repair.

    5. Talent Seekers: Companies acquiring other companies to increase their management and labor pools due to the present labor shortages are expected to increase.

    6. Geographical Expansion: Non-U.S. companies expanding their footprint and customer base into the U.S. due to economic challenges in their regions are expected to increase.

    7. Distressed M&A: Companies struggling due to economic uncertainty, specifically high inflation, interest rates, consumer debt, etc., will remain targets for M&A.

    8. Regulatory Changes: Buyers and banks are expected to remain cautious with companies facing potential regulatory changes.

    These eight trends in lower-middle-market M&A are worth watching in the next few years. 

    If you want to learn more about acquiring or selling a business, contact Eric J. Gall at [email protected] or 239-738-6227 for a confidential, complimentary discussion.