Australian mid-market M&A: Down but not out

Deals may be down, but the mid-market remains resilient and a promising value proposition.

Mid-market deal volume in 1H23 dropped 26% from 1H22, in line with declining totals across the broader M&A market in Australia. Values declined a more modest 4% in the same period, although still remained in line with historical averages observed over the last half decade, marking another period of extraordinary stability.

Regardless, mid-market activity remains robust with positive sentiment, driven by several key trends. For instance, many mid-sized businesses in Australia are facing the challenge of succession planning as founders reach retirement age. This is creating abundant opportunities for strategic buyers and private investors who can provide capital and management expertise to drive growth.

Equally, mid-market targets offer significant potential for value creation and dealmakers can leverage their own resources and expertise to enhance operational efficiencies, implement strategic initiatives and optimise cost structures.

-26% -4%

1H23 deal volume (126) declined from 1H22 (170 deals)

1H23 deal value (approx. AU$8.9bn) decreased from 1H22 (approx. AU$9.3bn)

Value increased from 1H22, heavily influenced by the AU$30bn Newmont Mining purchase of Newcrest Mining but highlights the enduring appeal of Australian assets. However, volume dipped, stalled by ongoing macroeconomic uncertainties, extended deal negotiations and due diligence considerations.