Mergers and acquisitions are a normal part of business life. The M&A market fuels much speculation across each industry or business sector. Trends in this area can impact the stock market, employment forecasting, and other important business and pop culture components. Here is a look at some of the merger and acquisition trends that appeared in 2021.
Pandemic Driven
The Coronavirus tore across the globe, leaving a devastating trail. Technology, research, and healthcare companies scrambled to find a way to slow the spread and reduce the impact for individuals who contracted COVID-19. A host of mergers and acquisitions, perhaps unintentional, resulted from the pandemic throughout 2021. Business and industry consultants advised pooling resources to fight the virus, and many companies realized the overwhelming benefits of a continued partnership.
Economic Necessity
As in other recent years, 2021 saw a fair share of merger and acquisition activity due to economic necessity. Arguably, much of this activity could have been at least partially due to the pandemic. Some businesses were struggling to survive before the forced closures, and the onset of the virus sped up the inevitable. Smart business owners and organizational leaders make the tough recommendation to merge with a competitor or related industry rather than face bankruptcy or have to close the doors altogether.
New Horizons
A few surprising merger and acquisition trends appeared in 2021 and are expected to continue throughout the upcoming year. Cutting-edge technology spans the spectrum and covers everything from space exploration to renewable energy solutions. Patented inventions and intellectual property rights protect the unauthorized use of specific technology, products, and ideas. Combining the efforts of two or more organizations can produce spectacular results that neither organization could have expected independent of the other.
As the merger and acquisition market continues to recover and clear plans for the near year are beginning to shape up, investors and analysts make many of the same predictions. For example, representation and warranties insurance will continue to rise as the M&A market barrels through the coming year. This simple policy helps buyers and sellers protect themselves from inaccurate or incomplete information during a business transaction that could ultimately impact the profitability of their position.