Summary of The 2018 M&A Report

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Rating

8 Overall

8 Importance

7 Innovation

8 Style


Recommendation

The word “synergy” is a well-worn term in the jargon-filled world of business. But when it comes to mergers and acquisitions, it’s an increasingly important one. Recent announcements about M&A synergies have raised valuations for targets and boosted publicized returns for acquirers. But investors are becoming more discerning and less willing to take promises about synergy at face value. Executives, board members and investment bankers will find this overview from the Boston Consulting Group a useful guide to the M&A environment. 

In this summary, you will learn

  • How trends in mergers and acquisitions activity and valuation have evolved,
  • Why synergy has moved to the forefront as a driver of M&A, and
  • What board members and executives can do to ensure that synergies occur after a deal closes. 
 

About the Authors

Jens Kengelbach et al. are professionals at the Boston Consulting Group. Sönke Sievers is a professor at Paderborn University in Germany.

 

Summary

M&A deals continue to get a warm reception from investors, although the landscape is evolving in ways that will have a keen impact on dealmakers’ future strategies. Activity remained stable in 2017, and in the first six months of 2018, deal values exceeded the average for comparable periods since 2009. Strong demand has raised target valuations, which now top those that prevailed during the e-commerce bubble in 1999. In fact, average acquisition prices are at a high. Despite lofty valuations, shareholders are eagerly encouraging the M&A trend. In a major...


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