Citizens survey: 3 unexpected factors support M&A optimism

Citizens’ 2024 M&A Outlook revealed optimism around the environment for dealmaking activity this year, underpinned by solid expectations for the U.S. economy and a pop in enthusiasm, especially among buyers.

In addition to upbeat expectations for the U.S. economy in the year ahead, the survey revealed several unexpected factors that could catalyze dealmaking in 2024. These include:

  • PE firms look ready to shop, and AI is on the wish list: Of the private equity firms that see higher deal flow in 2024, 8 in 10 said they expect to buy more than they did in 2023 and a quarter are looking for artificial intelligence assets to add to their portfolio.
  • International prospects are back on the table: After four years of declining expectations, buyer and seller interest in foreign deal partners is expected to rebound in 2024. Among midmarket companies, 51% of sellers and 44% of buyers said they would consider international deals. PE firms’ interest in international investment opportunities increased year-over-year to 55%, from 37%.
  • The 2024 U.S. election could be a driver for M&A: Uncertainty regarding the outcome of the upcoming U.S. election could support dealmaking in the first half of the year. Forty-one percent of midmarket companies said the pending election makes them more likely to pursue M&A in 2024, while just 25% say it makes them less likely to pursue a deal.

For more information on this year’s Citizens Middle Market M&A Outlook, please click here.