The public mergers and acquisitions (M&A) market has seen an upswing over the past 12 months, recording the highest number of transactions in over a decade, according to Corrs Chambers Westgarth.
Namely, the Australian public M&A market recorded 59 transactions in the 12 months to September 30, compared to 56 in the previous corresponding period.
Despite the record trading volume, the overall transaction value fell from approximately $78.2 billion to approximately $46.1 billion.
At the same time, Corrs explained that the year has not been without its challenges.
“Last year, we anticipated that there would be an increase in activity but that market dynamics would be ‘fragile,’ and this proved to be the case,” the law firm explains in a new report.
Indeed, inflationary pressures, combined with a still perceptible gap between buyers and sellers in terms of prices, have led to a notable increase in hostile transactions, up to 22 percent, compared to 13 percent in the 12 months to September 2023 .
And while Corrs expects the coming year to present additional challenges, she still anticipates increased activity and a wider variety of M&A transactions.
“Last year, we saw much higher levels of activity in the public M&A market than we have seen in a long time, and while the year ahead will face some challenges, we “We believe these high levels of activity will continue,” said group director Sandy Mak. .
“Interest rates are stable and there is a strong appetite for deal making, so our M&A outlook for the year ahead is promising.”
According to Mak, available capital, a strong appetite for strategic growth in certain sectors and the need to gain a competitive advantage are all factors that have been the main drivers of the increase in activity.
Corrs further predicts that the energy and resources sector will continue to dominate the local M&A landscape, having maintained its position for the third consecutive year.
“In addition, we expect the technology sector to remain one of the most active for M&A in Australia, with private capital playing a significant role,” Mak said.
Looking ahead, the law firm highlighted that M&A transactions could see a further increase ahead of Australia’s merger clearance reforms.
Thus, from January 1, 2026, with a transitional regime available from mid-2025, a mandatory and suspensive merger control regime will apply.
“This is a radical transformation from the previous voluntary notification regime for Australian traders…in essence, the new regime will encompass a significant number of transactions and could result in significant delays in transactions,” said Corrs.
As such, it expects buyers and sellers to seek to expedite their transactions with a tight completion timetable in order to complete their transactions before the start of the mandatory notification regime.
“Many merger parties seeking voluntary clearance in the second half of 2025 will seek to notify under the new regime to avoid being required to notify again if clearance is not granted before January 1 2026,” the statement said.
