Cross-Boarder Buyer's Market is coming? - M & A review series 1

Investment Bankers and M&A experts have a habit of forecasting what will come this year. Especially post-pandemic forecasting highlights ever. Deal Flow Bulletin is one of the open sources anyone can review.

Credibility

We must examine the source's credibility first when we review specific databases and statistics. Below is where the survey comes from. It excludes Asia but is worthwhile to refer to.

Observations

An increase in interest rates impacts previous years' acquisition financing costs with low-interest rates. However, when maturity has come, the shareholder's appetite to exit grows to avoid high-interest rates on refinancing.

Valuations

As external debt cost increase, the purchaser's equity return decrease. Which may impact the target's valuation as well. If a certain PE's target return is 15%, an increase in borrowing cost decreases the target valuation to satisfy the same target return.

Cross Border Market

If the restructuring market grows, it leads to the expansion of cross-border capital. So the cross-border market is coming.

Buyer's Market

To avoid high capital costs or restructuring, sellers are forced to sell their assets. As a result, the buyer's market is coming.

Conclusion

Cross-border Buyer's market is coming.

Dear K-Wolves

Let's go to the cross-border buyer's markets

An Excerpt of Conversation (includes informal expression)

喩彬 (Youbin): Hey Daoshi, what are you doing this early morning? Why did you start a new series without completing the ongoing speak-up and shut-up series? {back smash (등짝스매쉬)}

Kim Daoshi: Because I am water. It flows anywhere. No purpose but the flow with intuition.

May the Tao (道) be with you.