L.E.K. Consulting’s Post

Investor confidence rebounds: CIS industry sees R42.3bn in net inflows in Q3 2024. Assets under management grew to a R3.8 trillion, up 13.7% year-on-year, supported by strong equity market performance. Read More: https://buff.ly/3V1Ygc0 #assetmanagement #assetsundermanagement #ASISA #ASISAstats #AssociationforSavingsandInvestmentSouthAfrica #CIS #CISoutflows #collectiveinvestmentschemes #financialmarkets #generalelection #GovernmentofNationalUnity #investmenttrends #netinflows #netoutflows #fundflows #portfoliodiversification #equityportfolios #interestbearingportfolios #multiassetportfolios #SouthAfricaneconomy #stockmarketperformance #unittrusts #wealthmanagement

The M&A market has been active in 2024, but its rebound from last year’s has been slower than many anticipated. The recovery sees a trend ahead of last year bit still below the 10 year average. Financial conditions have generally improved, dealmakers remain cautious amid economic uncertainty, concerns about inflation and monetary policy, and regulatory and geopolitical headwinds. Sectors leading activity is Technology Financial services, Consumer and Energy. Private equity deal activity trended higher during the first six months of 2024, increasing in value by 9% versus the same period last year. Financial sponsors continue to feel pressure to invest their large amounts of dry powder. In contrast, early- and later-stage funding for startups is approximately 50% lower than in 2021, despite the strong enthusiasm for AI startups. The latter is also proving a good opportunity for trade players and strategic buyers to persue innovative and R&D related acquisitions or buy out deals as many early stage firms struggle to raise additional capital. #leadership #strategy #finance #leveragedfinance Nedbank *Adapted from BSG report.

Anish Ailawadi, Managing Director, Head of Investment Banking, Acuity Knowledge Partners, in an exclusive article authored for International Banker, highlights how global investment bankers are cautiously optimistic amid market uncertainty. He adds that following a year of supply-chain bottlenecks, rising inflation and high interest rates, investment banks (IB) have learned lessons from these tough market conditions. While market volatility and geopolitical unrest remain, investor confidence is cautiously growing, and IBs expect a recovery in mergers and acquisitions (M&A) and equity capital market (ECM) activity, he feels. This is the second consecutive article from Anish Ailawadi that has been featured in the publication.  Read the full article here: https://lnkd.in/eQtqwdea

Our quarterly M&A and Capital Markets newsletter provides analysis and details about the latest trends. Read the most recent edition to find out what to watch for in the second half of the year. https://lnkd.in/gdtCZtvY #MergersAndAcquisitions #MnA

How is the private equity market doing fundamentally? Is growth slower or faster? We analyzed the data 👇🏻 PE-backed assets have never been in better shape. 🚀 Growth is the strongest it has been in years, with PE-backed assets in Europe growing 18.8% YoY - well above their pre-pandemic averages. 📈 EBITDA margins for PE-backed businesses have been expanding too. They are up by over 170 bps over the last 7 years. Learn more about which sectors and regions are growing the fastest in our latest report: https://okt.to/tvGB1K #privateequity #H12024

Great publication and thanks to our colleagues around the world for all the articles and global perspectives. The key global themes driving M&A activity this year are: 1. More geo-political certainty 2. Improved macro-economic sentiment 3. Regulatory loosening 4. Availability of capital 5. Fast-emerging sectors (energy transition, AI, healthcare etc)

Sales to corporate buyers are expected to be the most dominant exit routes in the next 12 months (44% of respondents in our Aon survey), as investors seek clean breaks from their assets and strategic premiums to maximize value. This is followed by continuation funds and secondary transactions (32%), which continue to provide critical liquidity alternatives to PE investors amid a slower and more complex exit environment. Also most correspondents expect the M&A market to be far more active in 2025… which we clearly see in the preps that are being done today. Eager to learn your views - What do you think?? Early involvement - optimal results Reach out to my team. We are ready to help. #betterdecisions

Well worth a read as we scan the horizon to see what 2025 might bring.

Some interesting insights from different regions and industry sectors on the M&A outlook for 2025.

🚀 "The State of European Private Equity: H1 2024" report is officially out. It's packed with insights on entries, buy-and-build activity, exits, portfolio statistics and much more. Based on proprietary data from Gain.pro, here are our key findings: ➡️ Buyout deal activity in 2023 was the lowest it’s been in 6 years (down 32% from peak). ➡️ Add-on activity also took a hit in 2023 (down 31% YoY). Despite the decline, the ratio of add-ons to total PE deal activity remains near the decade-high. ➡️ Exits slowed down meaningfully in 2023 but recent data suggests that exits have now stabilized. ➡️ Roughly 55% of assets that exited in 2023/24 stayed longer than 5 years in the portfolio. The average holding period is at an all-time high of 5.8 years vs. 4.9 years in 2020. Discover even more insights like these in our full report 👉 #H12024 #privateequityreport #investmentinsights