The deal market in 2024 is expected to recover from the issues that were faced in 2023. The market for deals in 2023 is likely to experience a revival after the difficulties of 2023.

However, a number of factors will continue to hinder deal-making. The slowdown in M&A is largely due capital constraints. The rise in interest rates has altered the economic landscape, making it less attractive to invest in growth through acquisitions or new investments. This is particularly applicable to the US which is responsible for a large proportion of global deal value, with two thirds of the top hundred deals in 2021 involving an US company or a target.

Second, increased scrutiny by regulators is stifling M&A. Concerns about antitrust, national security and other issues are putting greater scrutiny on larger deals and limiting the potential for industry consolidation. The trend is expected to continue until 2024.

Third, the emphasis of generative AI (GIA) will lead to more M&A to develop capabilities. M&A will be utilized by companies that lack the time or expertise to build GIA capabilities internally. The environmental, social, and governance (ESG) agenda continues to gain traction among CEOs. They are more likely to boost ESG initiatives by acquiring companies that will help them achieve their growth, earning, and valuation goals.

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