11 Jun ECLA/GCLC General Counsel Roundtable: European M&A trends 2024
Locked box vs. completion accounts and purchase price adjustments in Europe vs. the US…?
ECLA and the General Counsel Leadership Circle Europe held a highly interesting and active virtual roundtable discussion on ‘European M&A trends 2024’ together with CMS Corporate/M&A Group represented by Louise Wallace and Laura Christin Stein, including 14 general counsel from 8 different European countries 🇪🇺.
Key observations in the market taken from CMS’ European M&A Study 2024:
💡 The M&A market remains under pressure due to economic uncertainties, higher interest rates, slow GDP growth in the US and Europe and geopolitical threats but also proves to be resilient
💡 Earn-out agreements are overall decreasing in M&A deals, indicating a shift towards more predictable deal terms
💡 Liability caps remained relatively stable across various purchase price segmentation in the years from 2010 to 2024
💡 W&I insurances are used in M&A deals across Europe with the use remaining stable
💡 ESG considerations still on the rise: Due diligence continue to focus on sustainable and responsible investments
Overall there is reasons to be cheerful in 2024:
📣 Global Q1 M&A volume rose 5-10% vs. 2023
📣 Banks lending again. Monetary policy should ease
📣 Risk of a sharp economic downturn is receding
📣 PE likely to return as they seek exit strategies and redeployments
📣 Seismic shifts driving M&A e.g. AI, sustainability, tech-enabled consumer class
📣 Favourable sector dynamics e.g FS consolidation, Tech-driven M&A, Oil & Gas consolidation, renewables
The new CMS study on European M&A trends can be downloaded here: https://cms.law/en/deu/publication/cms-european-m-a-study-2024
ECLA’s next general counsel roundtable discussion is scheduled for 25 June 2024 at 10:00 CEST and will focus on ‘Cross-Border M&A Transactions and Pan-European Restructuring / Transformation Projects’.