HORIZONS | BDO'S GLOBAL VIEWOF MID-MARKET DEAL ACTIVITY 27
DACH RECOVERING MID-MARKET M&A ACTIVITY IN DACH COMPARED TO 12 MONTHS AGO ALBEIT COVID-19 AND THE ASSOCIATED ECONOMIC UNCERTAINTY CONTINUES TO IMPACT OVERALL STATISTICS. PE ACTIVITY ACCELERATING MORE QUICKLY ACCOUNTING FOR 40%OF ALL DEALS BY VOLUME
On a year-on-year as well as on a quarterly basis, the DACH Mid- Market M&A demonstrated similar trends to the global Mid-Market M&A activity but was slighter stronger. Global Mid-Market M&A transaction volumes increased by 17% (DACH 32%) transaction values were up by 27% (DACH 56%) compared to Q3 2020. Quarter on quarter, the global M&A volume decreased by 20% (DACH -19%) and the values by 16% (DACH -15%) compared to Q2 2021. Looking ahead we expect M&A activity in DACH to continue to recover, notwithstanding the mixed economic environment, driven by PE activity and strategics looking to access technology, accelerate digital transformation and adapt business models. The number of mid-market M&A transactions reported in DACH in Q3 2021 was 70, an increase of 32% compared to Q3 2020. This reflects an increased confidence about the overall impact of the Covid-19 pandemic compared to the global state of emergency in the first three quarters of 2020.
BIG PICTURE
• Significant increase in both volume (+32%) and value (+56%) of deals in Q3 2021 compared to Q3 2020. Both the value (-19%) and the volume (-15%) of transactions decreased quarter on quarter. However, the volume of transactions decreased less, implying a relative increase in the average deal value • Transactions involving PEs demonstrated even stronger trends. On a year-on-year basis both volume and value increased by 220% and 132% respectively. On a quarterly basis, volume increased by 10% while values declined by 20% • In the Mid-Market year-on-year growth in number of transactions is driven primarily by TMT, Business Services and to a lesser extent Real Estate • Strong international interest in the DACH Mid-Market continued. In eight out of the largest 20 deals, acquirers were European (other than German) while seven were US-based. The greatest number of transactions in the Top 20 involved German targets (75%) but there was strong interest in Austria and Switzerland as well.
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