PWC say they expect 2023 to be characterised by a more disciplined approach to M&A in the industrial manufacturing and automotive (IM&A) sectors as dealmakers contend with the challenging macroeconomic environment. Headwinds such as slowing GDP growth, the Russia–Ukraine conflict, the energy crisis, and rising interest rates and inflation led to a reset in M&A activity in 2022 back to pre-pandemic levels.
Despite market turbulence, companies in the IM&A sectors with strong balance sheets will likely continue to be active in M&A. Corporate players are focused on acquisitions to gain access to new technology and service capabilities or to create scale efficiencies through consolidation. A continued focus on building greater resilience into their supply chains is also keeping corporate M&A activity at a stable level. While private equity (PE) and special purpose acquisition companies (SPACs) will continue to transact, they face a more challenging environment. Read the full outlook here