Impact of Macro-Economic Environment on Cross-Border M&A

Published: Nov. 16, 2022, 9:58 p.m.

In this episode of S&C\u2019s Critical Insights, Melissa Sawyer, the Global Head of S&C\u2019s M&A practice, is joined by Carsten Berrar, the Managing Partner of the Firm\u2019s Frankfurt office, and Olivier de Vilmorin, the Head of the Firm\u2019s European M&A practice, to discuss cross-border M&A transactions in the current economic environment.\n\xa0\nCarsten and Olivier discuss some of the macro-economic trends impacting the European market, including the energy supply crisis, inflation, recession as well as transformational issues, such as the mobility car industry. Additionally, heightened Antitrust scrutiny and an increased relevance of Foreign Direct Investment (FDI) Screening add to deal complexity and have reduced the pace of M&A transactions significantly. Despite these factors, a significant number of deals have been struck in the energy, infrastructure and cybersecurity sectors in Europe.\xa0 Cautiously optimistic, Carsten and Olivier expect a significant number of P2P, carve-out and distressed M&A transactions in the coming months. Moreover, China\u2019s softening of pandemic restrictions and the slowdown of inflation in the United States have had a positive impact on the European markets and could provide a boost for M&A deals.\n\xa0\nMelissa provides a U.S. perspective of the market for cross-border transactions into Europe. She points out that this is a great time for U.S. acquirers to be thinking about making investments in Europe as the market is less competitive than in recent years.