2024 Mergers and Acquisitions Review: Key Trends and Insights
By: Michael Lamm – Managing Partner – Corporate Advisory Solutions
The mergers and acquisitions (M&A) landscape in 2024 was marked by dynamic shifts, strategic consolidations, and evolving market conditions. Businesses looking to expand, diversify, or optimize operations have been closely watching the trends shaping the industry. This review summarizes the M&A activity in Q2, Q3, and Q4 of 2024, drawing insights from Corporate Advisory Solutions (CAS) and analyzing key drivers, industry movements, and future implications.
Q2 2024: A Surge in Transactions and Strategic Acquisitions
The second quarter of 2024 saw a notable 14% increase in transaction volume compared to Q1, reaching just under 50 deals in the tech-enabled outsourced business services (OBS) sector. More significantly, deal values surged by over 200%, reflecting a strong desire for strategic acquisitions.
Key industries leading M&A activity included:
Accounts Receivable Management (ARM): KnovaOne’s sale to TRAKAmerica and Flock Financial’s $25 million recapitalization were among the most prominent deals.
Healthcare Revenue Cycle Management (RCM): Major consolidations, such as MedMetrix’s acquisition of HBCS, underscored the sector’s ongoing transformation.
Customer Relationship Management (CRM): Companies pursued acquisitions to enhance digital capabilities and expand service offerings.
Key Trend: Increased buy-side activity, with large players acquiring smaller competitors to scale operations, adopt advanced technologies, and strengthen market positions.
Q3 2024: A Strong Rebound and Record-Breaking Deal Values
Momentum accelerated in Q3 2024, with 57 transactions totaling nearly $15 billion, marking a 63% increase in volume and over 150% growth in deal value from Q3 2023.
Healthcare RCM led the way, with major deals such as R1 RCM’s privatization by TowerBrook and CD&R showcasing investor confidence in the sector.
The OBS sector witnessed platform transaction values surge over 600%, emphasizing the push toward consolidation and efficiency-driven deals.
Key Drivers:
The Federal Reserve’s rate cut in September lowered capital costs, fueling increased M&A activity.
Late-stage investing gained momentum, with 29% of deals occurring in Series B and C and Growth rounds, driven by AI advancements and market expansion strategies.
Q4 2024: A Mixed Quarter with Long-Term Opportunities
While Q4 saw a decline in deal value to just over $4 billion across 53 transactions, this was still nearly three times higher than Q4 2023. The downturn was primarily due to fewer large-scale deals, but the market remained favorable for buyers as companies sought strategic acquisitions at lower valuations.
Key Sectors:
ARM and Business Process Outsourcing/Customer Experience (BPO/CX) dominated Q4, with CAS closing four notable deals by year-end.
Political and regulatory uncertainty under the new administration created short-term hesitancy among sellers, although many of them expect valuations to rise in 2025.
Key Insight: Buyers continue to pursue opportunities aggressively, setting the stage for an active dealmaking environment in 2025.
Looking Ahead: The M&A Landscape in 2025
Despite fluctuations, the 2024 M&A market demonstrated resilience and strong deal activity, closing the year with 201 transactions totaling $26.3 billion—a significant increase from 2023.
Looking ahead, CAS anticipates sustained M&A momentum into 2025, driven by:
Declining capital costs, fueling more strategic acquisitions.
Industry consolidation trends that favor well-positioned buyers.
Technological advancements in AI and automation that continue to reshape investment strategies.
What This Means for the M&A Industry
For businesses navigating this evolving landscape, the key takeaway is clear: adaptability and strategic decision-making are critical. Whether seeking expansion, partnership opportunities, or technology-driven growth, staying informed on M&A trends will be essential for long-term success.