The deal market in 2024 is likely to see an improvement from the difficulties of 2023. The market for deals in 2023 is likely to experience an increase in activity following the challenges of 2023.

Deal-making will be hindered by a number factors. First, the slowdown in M&A activity is largely due to capital limitations. The rise in interest rates has altered the economic landscape and made it less appealing to invest in growth through acquisitions or new investments. This is particularly applicable to the US which accounts for a significant portion of global deal value, with two-thirds of the top 100 deals of 2021 featuring the US company either as an offerder or target.

Second, increased scrutiny by regulators is limiting M&A. National security, antitrust and other issues are causing the scrutiny of larger deals, and restricting consolidation opportunities. The trend is expected to continue into 2024.

Thirdly, the focus on generative AI (GIA) will result in more capabilities-building M&A. M&A will be used by companies who lack the resources or time to develop GIA capabilities internally. Finaly, the environmental social and governance agenda continues to gain momentum with CEOs. They are looking to making informed choices boost ESG initiatives by purchasing companies that will assist them in reaching their growth, earning, and valuation goals.