London \u2014 Global buy-and-build analy\u00adsis: add-on acti\u00advity in German M&A market increa\u00adses signi\u00adfi\u00adcantly TMT, busi\u00adness services and health\u00adcare sector are the drivers.<\/p>\n
In times of adverse finan\u00adcing condi\u00adti\u00adons, buy-and-build stra\u00adte\u00adgies have gained signi\u00adfi\u00adcant trac\u00adtion in M&A globally, with TMT, busi\u00adness services and health\u00adcare sectors as drivers. This is the conclu\u00adsion of the latest buy-and-build inte\u00adgra\u00adtion study by Eight Advi\u00adsory, Euro\u00adpe\u2019s leading tran\u00adsac\u00adtion, restruc\u00adtu\u00adring and trans\u00adfor\u00adma\u00adtion consultancy.<\/p>\n
While the Anglo-Saxon market has tradi\u00adtio\u00adnally domi\u00adna\u00adted in this area, Germany is now clearly follo\u00adwing suit. In parti\u00adcu\u00adlar, highly frag\u00admen\u00adted sectors charac\u00adte\u00adri\u00adzed by strong growth and a large number of compe\u00adti\u00adtors are popu\u00adlar with inves\u00adtors, who grow a plat\u00adform company via add-on acqui\u00adsi\u00adtion and inte\u00adgra\u00adtion of suita\u00adble other compa\u00adnies. The white\u00adpa\u00adper on buy-and-build inte\u00adgra\u00adtion is based on figu\u00adres from indus\u00adtry services provi\u00adder Mergermarket.<\/p>\n
Accor\u00adding to the report, the share of buy-and-build acqui\u00adsi\u00adti\u00adons, as a percen\u00adtage of the total number of all M&A tran\u00adsac\u00adtions, grew globally from 6% (2012) to 15% (2022) over the past decade. In this context, Germany has been consis\u00adt\u00adently repre\u00adsen\u00adted in the list of the most active five count\u00adries since 2012 and has recor\u00added the stron\u00adgest growth rates compared with the leading markets of the USA, the United King\u00addom and France. While buy-and-build deals accoun\u00adted for just 5% of total tran\u00adsac\u00adtion volume in 2015, this figure rose to 12% last year.<\/p>\n
The growing importance of the buy-and-build stra\u00adtegy for inves\u00adtors in Germany is also reflec\u00adted in the deve\u00adlo\u00adp\u00adment of abso\u00adlute figu\u00adres: In recent years, the number of acqui\u00adsi\u00adti\u00adons rose from 62 (2015) to 282 (2022), an increase of around 355 percent. Marc Niclas and Curt-Oliver Luch\u00adten\u00adberg, part\u00adners at Eight Advi\u00adsory<\/strong> in Tran\u00adsac\u00adtion Support and Stra\u00adtegy & Opera\u00adti\u00adons, respec\u00adtively, agree, saying, \u201cGiven the incre\u00adasing econo\u00admic uncer\u00adtainty, we believe the buy-and-build stra\u00adtegy will conti\u00adnue to gain trac\u00adtion. This is espe\u00adci\u00adally true for inves\u00adtors who want to conti\u00adnue to achieve high returns along\u00adside ambi\u00adtious manage\u00adment teams, espe\u00adci\u00adally in light of fluc\u00adtua\u00adting tran\u00adsac\u00adtion values.\u201d<\/p>\n TMT, Busi\u00adness Services and Health & Pharma at the top in Germany<\/strong><\/p>\n The success of a buy-and-build stra\u00adtegy depends heavily on the sector in which the invest\u00adment was made. In Germany, the focus of buy-and-build inves\u00adtors last year was parti\u00adcu\u00adlarly on TMT (112 tran\u00adsac\u00adtions), Busi\u00adness Services (40 tran\u00adsac\u00adtions) and Health\u00adcare (30 tran\u00adsac\u00adtions). In percen\u00adtage terms, the Busi\u00adness Services sector was the busiest, accoun\u00adting for 19% of all tran\u00adsac\u00adtions: almost one in five tran\u00adsac\u00adtions was an add-on as part of a buy-and-build stra\u00adtegy. In the TMT (112 out of 749) and Cons\u00adtruc\u00adtion & Manu\u00adfac\u00adtu\u00adring (25 out of 167) sectors, add-ons accoun\u00adted for 15 percent of M&A tran\u00adsac\u00adtions each, while in the Chemi\u00adcals & Mate\u00adri\u00adals sector, add-ons accoun\u00adted for 9 out of 64 tran\u00adsac\u00adtions, or about 14 percent. Gene\u00adrally less suita\u00adble for buy-and-build stra\u00adte\u00adgies are complex indus\u00adtries with mostly cycli\u00adcal busi\u00adness models, inclu\u00adding mecha\u00adni\u00adcal engi\u00adnee\u00adring or utili\u00adties & energy. Even in the tech indus\u00adtry, there are often diffi\u00adcul\u00adties with inte\u00adgra\u00adtion because compa\u00adnies are very diffe\u00adrent and product appli\u00adca\u00adti\u00adons differ, making it more diffi\u00adcult to align systems.<\/p>\n Rela\u00adtive number of acqui\u00adsi\u00adti\u00adons by plat\u00adform compa\u00adnies also growing<\/strong><\/p>\n The incre\u00adasing importance of add-ons for the growth stra\u00adtegy and the profes\u00adsio\u00adna\u00adliza\u00adtion of the inte\u00adgra\u00adtion of acqui\u00adred compa\u00adnies has led to more target compa\u00adnies being acqui\u00adred on average. In 2015, plat\u00adform compa\u00adnies bought an average of 2.9 compa\u00adnies at the global level; this figure increased to 3.4 from 2019 and reached 4.0 in 2022. In Germany, the values deve\u00adlo\u00adped slightly upward from 2.0 in 2019 to 2.4 compa\u00adnies in 2022. Clear gover\u00adnance prin\u00adci\u00adples are essen\u00adtial for the successful inte\u00adgra\u00adtion of an add-on. For the inves\u00adtor, it is important to ensure that the future manage\u00adment has the neces\u00adsary capa\u00adcity to manage, in some cases, seve\u00adral inte\u00adgra\u00adti\u00adons simul\u00adta\u00adneously. In gene\u00adral, howe\u00adver, the number of add-ons shows a slow\u00addown after five tran\u00adsac\u00adtions. Only 15% of compa\u00adnies have purcha\u00adsed more than six add-ons and less than 1% have purcha\u00adsed more than ten.<\/p>\n Curt-Oliver Luch\u00adten\u00adberg: \u201cThe foun\u00adda\u00adtion of a successful stra\u00adtegy is laid with the suita\u00adbi\u00adlity of the plat\u00adform acqui\u00adred first and the compe\u00adtence of the manage\u00adment. Add to this a compre\u00adhen\u00adsive and easily multi\u00adplia\u00adble inte\u00adgra\u00adtion play\u00adbook and suffi\u00adci\u00adent inter\u00adnal and exter\u00adnal expert capa\u00adcity, and the chan\u00adces of achie\u00adving the desi\u00adred value increase rapidly.\u201d<\/p>\n Rising deal volu\u00admes in buy-and-build transactions<\/strong><\/p>\n The published tran\u00adsac\u00adtion volu\u00admes for buy-and-build deals in Germany show a simi\u00adlar picture: Values have risen steadily for years, apart from a slight dip in the crisis year 2020, and were at a five-year high of almost EUR 14 billion in 2022. Just under 8.5 billion of this was attri\u00adbu\u00adta\u00adble to cross-border deals. Over\u00adall, the share of buy-and-build tran\u00adsac\u00adtions in Germany is still quite low at 6.1 percent of the published total M&A tran\u00adsac\u00adtion value \u2014 but as this has increased by 5.5 percen\u00adtage points since 2018, the market should conti\u00adnue to grow rapidly in the coming years.<\/p>\n About Eight Advisory<\/strong> London \u2014 Global buy-and-build analy\u00adsis: add-on acti\u00advity in German M&A market increa\u00adses signi\u00adfi\u00adcantly TMT, busi\u00adness services and health\u00adcare sector are the drivers. In times of adverse finan\u00adcing condi\u00adti\u00adons, buy-and-build stra\u00adte\u00adgies have gained signi\u00adfi\u00adcant trac\u00adtion in M&A globally, with TMT, busi\u00adness services and health\u00adcare sectors as drivers. This is the conclu\u00adsion of the latest buy-and-build integration [\u2026]<\/p>\n","protected":false},"author":2,"featured_media":48666,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"wp_typography_post_enhancements_disabled":false,"footnotes":""},"categories":[886,1364,1366,1377,2635],"tags":[],"class_list":["post-48670","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general-en","category-featured-en","category-news-en","category-corporate-finance-ma","category-corporate-finance-mergers-acquisitions-en-en"],"yoast_head":"\n
\n\u201cHowe\u00adver, Health\u00adca\u00adre\u2019s soaring fortu\u00adnes could soon slow down again in Germany if the Fede\u00adral Minis\u00adter of Heal\u00adth\u2019s plans to ban the acqui\u00adsi\u00adtion of medi\u00adcal care centers by finan\u00adcial inves\u00adtors become reality. This would make buy-and-build, which is espe\u00adci\u00adally popu\u00adlar in areas such as dental and ophthal\u00admo\u00adlogy chains, much more diffi\u00adcult or even impos\u00adsi\u00adble,\u201d Niclas said.<\/p>\n
\nEight Advi\u00adsory advi\u00adses entre\u00adpre\u00adneurs, CEOs, inves\u00adtors and banks on tran\u00adsac\u00adtions, restruc\u00adtu\u00adrings and trans\u00adfor\u00adma\u00adti\u00adons. The group of 750 employees, inclu\u00adding 82 part\u00adners, supports execu\u00adti\u00adves in finan\u00adcial and opera\u00adtio\u00adnal decis\u00adion-making proces\u00adses. Eight Advi\u00adsory is an inde\u00adpen\u00addent Euro\u00adpean group with offices in France, the UK, Belgium, the Nether\u00adlands, Germany and Switz\u00ader\u00adland. As a foun\u00adding member of Eight Inter\u00adna\u00adtio\u00adnal, the company can draw on a global network of inde\u00adpen\u00addent part\u00adners in over 30 count\u00adries in Europe, America, Asia and Oceania.
\nwww.8advisory.com<\/p>\n","protected":false},"excerpt":{"rendered":"