State of Mergers and Acquisition due to Coronavirus in 2020

Coronavirus has transformed almost every aspect of our lives and the businesses alike. M&A transactions are no exception.

According to a survey by Deloitte:

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However, it doesn’t necessarily mean less M&A opportunities and activities.

It’s expected to see increasing potential for distressed M&A’s as result of Covid-19 and investors will likely position themselves early in order to seize these opportunities.

These opportunities however will differ from sector to sector. Below is an interesting insight into Changes in Market Cap for Australian Companies in Q1 2020:

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Market Cap is an indication of the investors sentiment and expected return into the future, and by studying the trends one can draw some conclusions as to what sectors are likely to be more attractive to potential buyers hence more M&A activities i.e. the more the Market Cap is hit, the more likely there’ll be acquisition opportunties in that sector.

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