What does the M&A market look like as we rebound from the Covid-19 pandemic and head into 2021? What role will private equity play in the recovery? Will we see an uptick in shareholder activism? When will the bankruptcies stop?
As the markets adjusts to a new volatile normal of fluctuating valuations and financial instability, dealmakers, too, have adjusted. Many companies have been forced to look at new financial levers they can pull to stabilize their business, be it bringing in outside investors, selling’s assets, changing management teams or re-evaluating core capital expenditures.
What are the best paths toward long term shareholder value creation for dealmakers? With additional challenges and increased risk in every transaction, how have dealmakers refreshed their toolbox of risk mitigation strategies and insurance to protect themselves from deal announcement to close?
Join The Deal and a roster of senior corporate executives, private equity and institutional investors, and corporate advisers for The Deal Economy. This virtual event features a week of online sessions exploring the opportunities, obstacles and risks dealmakers face in the current environment and how to navigate through them.
The Deal Economy: Predictions and Perspectives features daily broadcasts of panel sessions and interviews, and your registration provides access to the entire week of sessions. You can view them live as they happen or on demand at a time that is convenient for you.
Covid-19 has impacted everything from the way we work, the way we shop, the way we socialize and, in many ways, the way M&A and private equity transactions are carried out. What does the dealmaking landscape look like as we rebound from the coronavirus pandemic and head into 2021? Sectors including software-as- a-service, healthcare IT, logistics and business services are ripe for private capital investment seeking to fund innovative companies, but how is transaction volume and pricing being affected by the current market volatility? What is the macroeconomic effect on dealmaking around the globe, and what geographic areas are most at risk? What opportunities should dealmakers be looking for as we turn the corner and face the new normal of getting a deal done?
The lines between private equity and activist hedge funds continue to blur, as market volatility creates opportunities for private equity style returns even in the public markets for those that can accurately pick their spots. But as things return to normal will private equity firms continue to take large toe-hold stakes in companies to get a leg up in potential take-private deals? Will we see shareholder activists push these distressed companies into the hands of private equity as this may become one of the only avenues that will finance the influx of battered companies? Will private equity take a more active role with public company investments?
With valuations volatile across both public and private markets, many companies – especially those strapped for cash – have been forced to take a look inward and decide if there are financial levers they can pull to stabilize their businesses. Whether selling off assets, chunks of equity or issuing debt, the market has shifted from a pre-covid seller’s market to a buyer’s market for those with the cash to do so. How are buyers assessing valuations amid the disruption? Have sellers’ expectations changes? With the increased risks in the current environment, what type of insurance and risk mitigation strategies are being established to protect parties within a deal form announcement to close? Does Covid-19 and its effects constitute an event that could trigger a Material Adverse Effect clause to terminate an agreement?
In the thralls of the pandemic corporations were focused on keeping their employees, customers and businesses safe in this uncertain time. But as normalcy, or at least a new normal, settles in, corporate leaders are faced with the reality of making strategic decisions which may include shedding assets during uncertain times to sure up other aspects of their business. At the same time, while investors may applaud such moves that add some near-term liquidity, such as carve-outs and divestitures, is this the right decision for long-term value creation? How should companies evaluate non-core assets at a time when sales and revenues have been depressed for the last year? How can dealmakers de-risk their M&A strategy and deploy sound scenario portfolio planning during the recovery?
Much of large cap dealmaking took a brief hiatus amid the pandemic as did cross-border dealmaking. Resources, of course, were shifted from corporate growth plans in favor of survival efforts. At the same time, however, scale and diversification seem to have grown in importance in some instances, as some geographies find themselves less effected by the global disruption, or at least quicker to get back on their feet. How has the pandemic changed the nature of cross-border dealmaking both from a logistical and practical standpoint? At what point does a company need to look at capital deployment that adds scale and diversification to a suite of businesses that may be focused on a singular market.
As the effects of Covid-19 ripple through public and private markets, opportunities for private equity firms and their investors are evolving. Whether a shift from growth to distressed investing or putting more money to work to help prop up struggling companies, private equity has looked to various places to find new deals. Secondary PE stakes in distressed funds have cycled back in favor while some of the recently announced buyout funds roll out off the menu for investors. Where has private equity looked for opportunities amid the financial turmoil? In which types of funds are institutional investors keen to deploy capital? Which sectors are on the top of buying lists and how has that changed since the pandemic?
Commercial real estate is at a crossroads. The world’s retailers – from Wall Street to Main Street — have struggled to keep the lights on with light foot traffic while corporate employers question their mostly empty geographic footprints. What opportunities exist for investors in the real estate sector as valuations and expectations begin to rationalize? What industries – i.e. logistics or manufacturing or housing – can take advantage of the changing appetite for real estate after the pandemic? Is there a permanent shift underway?
What are dealmakers saying behind the scenes? A panel of The Deal’s senior editors talk about the trends they have seen post-Covid-19, opportunities for advisers and investors and industries on the precipice of breakouts, as well as field questions from the audience. Want to find out what about how Covid-19 has impacted the dealmaking space through the eyes of our journalists.
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