After a record year in 2022: fewer mergers and acquisitions last year

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With a total of 484 transactions by the consulting firm KPMG, the total transaction volume reaches 72 billion US dollars. A record 647 mergers and acquisitions and a volume of US$ 139 billion were recorded with Swiss participation in 2022.

“The lower number of deals compared to the previous two record years is primarily due to higher interest rates and increased economic uncertainty,” Timo Knak, Head of Deal Advisory at KPMG Switzerland, said in a press release on Monday. He expects a slight upward trend for this year.

According to KPMG’s “Clarity in Mergers and Acquisitions” report, the industrial sector, telecommunications, media and technology sector (TMT), as well as the pharmaceutical and life sciences sector, were the most active sectors at the industry level.

Meanwhile, experts classify the low rates of mergers and acquisitions with private capital participation as exceptional. In 2023, investment companies were involved in less than a quarter of transactions, compared to about a third in previous years.

“Many private equity investors focused on optimizing their existing portfolios last year due to the challenging economic environment,” Knak explained. Additionally, price expectations of sellers and buyers often differ.

The biggest transaction in 2023 wasn’t just the takeover of Credit Suisse by UBS, which ranked fourth. The biggest deal was the sale of agricultural company Vittera by Glencore to the US group Bunge for $17.3 billion. The second major deal was the acquisition of biotechnology company Telavant by Roche for approximately 7.3 billion US dollars.

Glencore again came in third place with its acquisition of Teck’s Elk Valley Resources steel coal division ($6.9 billion). The Swiss company attempted to take over the entire Canadian mining company at the beginning of the year. However, the plans failed due to resistance from Teck and Canadian politicians.

As for Swiss companies, they acquired significantly more foreign companies in 2023 than vice versa: 216 acquisitions compared to 118 sales. According to the information obtained, deals in Switzerland constitute approximately one fifth of all mergers and acquisitions with Swiss participation. (SDA)

Source :Blick