MARKET
REPORT
Q4 2021
TITAN PARTNERS CORPORATE FINANCE
LATEST M&A
MARKET INSIGHTS &
KEY STATS IN
AUSTRALIA
ABOUT TITAN PARTNES CORPORATE FINANCE
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AUSTRALIAN M&A ACTIVITY – Q4 FY2021
The table below shows the completed M&A deal volumes by industry in Q4 FY2021. Over the quarter we see the number of transactions in Resources & Mining remain high, buoyed by high commodity prices. And also in real estate where the low cost of debt is in part driving the volume of transactions.
Transactions by Industry
TOP 5 INDUSTRIES FOR TRANSACTIONS
The market is showing confidence in Real Estate & Construction, Information Technology and Hospitality & Leisure as all three industries have had significant increases. Healthcare is fairly stable in this quarter, given the current climate. However due to the continued Covid-19 situation the deal volume has dropped for Resources & Mining.
EXECUTIVE SUMMARY
Progressing through the pandemic has shown an impact on businesses globally. Interrupted by lockdowns in Australia, parts of the economy have been forced to rely on technology to support businesses across many industries. The final quarter results show that the Information Technology sector has significantly increased in deal activity as a direct result of the pandemic market conditions.
Businesses are enhancing digital capabilities to service customers and adapt to changes in the workforce which has sparked new investments in technology industries, while resource industries are holding their position as the market oscillates between trends.
With some trends in line with the previous quarter, this quarter reflects similar outcomes to Q3, however also showing growth particularly in Mining & Resources, Real Estate, and as expected the Healthcare industry.
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ASX LISTED COMPANY VALUATIONS Q4 FY2021
Aggregated market capitalisation by sector is stable across all sectors compared to last quarter.
Total Market Capitalisation
TRANSACTION ACTIVITY – Q 4 FY2021
Resources & Mining and Real Estate & Construction continue to dominate transactions by quantum.
Top Five Industries for Transactions
Unsurprisingly the number of transactions in the travel sector has remained at zero in this quarter as with the prior year.
Bottom Five Industries for Transactions
HIGH LEVEL STATS
Completed transactions in Q4 2021
As record by CapitaliQ(1)
45% increase in Market Capitalisation between Q4 2020 – Q4 2021
M&A transactions volume is broadly consistent between Q4 – Q3 FY2021
(1) WE NOTE CAPITALIQ DOES NOT RECORD EVERY TRANSACTION AND THE TOTAL NUMBER OF PRIVATE COMPANY M&A TRANSACTION WILL BE MUCH HIGHER, BUT THE MOVEMENT BETWEEN THE TWO PERIODS RECORDED BY CAPITALIQ IS A GOOD INDICATOR OF THE MOVEMENT IN TOTAL DEAL VOLUMES
GLOBAL OUTLOOK
We continue to see evidence of sector specific failures in the most impacted industries.
The use of technology has become more important during the COVID 19 crisis to compensate for the physical remoteness imposed by the demands of social dissociation. We expect this trend to continue post pandemic.
Similarly, the strength in specific industries highlights the importance of companies “ability to adapt to changing market conditions”, thereby increasing companies’ resilience in times of crisis.
Aside from industries decimated by the pandemic (i.e. travel), many firms that survive the coronavirus crisis will need to be innovators or adopters who can benefit by using digital technologies to maintain or grow their business in a changing environment.
