M&A Continues Strong Performance in Q3
Amidst a more positive economic outlook, the number of merger and acquisition (M&A) deals increased in the third quarter of 2024, according to a report by Crosbie & Co. Inc.
In the third quarter, there were 655 M&A deals announced, which is a 1% increase from the previous quarter and a 13% increase from the same period last year. This marks the third consecutive quarterly increase in deal volume, signaling a resurgence of confidence in the Canadian M&A market.
Although deal volume grew, the total value of transactions in the third quarter decreased by 10% to $66 billion. However, there was a notable increase in “mega deals” (transactions exceeding $1 billion), with 20 mega deals announced totaling $49 billion in value.
Additionally, mid-market activity (deals valued at less than $250 million) remained robust during the third quarter, with a 6% increase in transaction volume from the previous quarter.
By sector, mining was the most active sector in the third quarter, with 91 deals amounting to $11 billion. Real estate deals also rebounded, along with increased M&A in precious metals, communications, and tech sectors.
According to Richard Betsalel, managing director at Crosbie & Co., the positive deal activity was supported by stable economic conditions in Canada and the U.S., along with a more optimistic market sentiment reflected in the strong performance of equity markets.
Looking ahead, the report highlighted potential economic uncertainty due to the incoming U.S. administration and tariff threats. However, it anticipates that any impact on cross-border deal activity may be short-lived, as there is a mutual incentive to resolve issues quickly.
In summary, the third quarter of 2024 saw a resurgence in M&A activity driven by improving economic conditions and a positive market outlook. The strength of mid-market transactions, along with the prevalence of mega deals, indicates a broad-based confidence in the Canadian M&A landscape.
