The consumer goods industry has always been a sector where the tools of mergers and acquisitions have allowed the world’s companies to relatively quickly build up competitive advantages and adapt to today’s changing socio-economic trends. Check some acquisition trends for 2022 in the article below.
The Analysis of the Global M&A Market
In today’s conditions, world markets are in the process of fundamental structural, technological and institutional changes and represent a significant potential for the expansion of the international corporate sector. At the same time, there is a growing understanding that in the coming years, the development of markets will be part of the general process of economic globalization, the impact of which on the competitiveness of companies is becoming more and more significant. Expanding the boundaries of capital reproduction to a global scale in the conditions of the modern scientific and technical revolution and increased competition gives new features to the processes of concentration and centralization.
The challenges and opportunities of the data room environment require the flexibility that mergers and acquisitions can provide to remain competitive, both today and in the long term. A breakdown of industry analysis shows an increase in the number of mergers and acquisitions in sectors such as finance, pharmaceuticals, and energy. The analysis of the global market of mergers and acquisitions in today’s conditions made it possible to reveal specific features of its development:
- a decrease in the quantitative and value volume of transactions;
- change in the industry structure and motivation of deals;
- an increase in the number of canceled deals due to the lack of own sufficient funds and the difficult availability of loan funds.
Which Are Some Acquisition Announcements to Keep an Eye Out for in 2022?
An acquisition may be appropriate if two or more companies have complementary resources at their disposal. Each of them has what is necessary for the other, and therefore their fusion can be effective. These companies would be worth more after the merger compared to the sum of their pre-merger values because each acquires what it lacked and gets those resources cheaper than it would have cost it if it had had to create them on its own. Take a look at the main acquisition announcements for 2022 below:
- 2022 will be another year of consolidation, strategic acquisitions, and disposals in the sector.
- More M&A deals are expected, caused by the active actions of investors, which will stimulate the acceleration of portfolio changes.
- Health and wellness will be a priority in the food, beverage, and consumer products group.
- Companies will continue to replace research and development (R&D) and innovation with mergers and acquisitions and strategic partnerships.
- Chinese and Japanese investors will continue to look west to acquire properties.
Most researchers of the history of integration agreements note that the world market of mergers and acquisitions developed in a wavelike manner. Mergers and acquisitions of companies can provide savings obtained due to the centralization of marketing, for example, by combining efforts and providing flexibility, the ability to offer distributors a wide range of products, and use of promotional materials. By the synergistic effect in the acquisition, we mean an increase in the performance indicators of the enterprise or the added value of assets as a result of combining enterprises into a single system, where the effect of their interaction exceeds the sum of the effects of the activities of each enterprise separately