M&A Year in Review 2023 brochure - Flipbook - Page 92
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Sectors to Watch
Energy
Energy will continue to be among the most active
sectors for transactional activity in 2024, with an
increase in dispositions, and restructurings leading
to industry consolidation.
Energy transition is here to stay. 2023 saw COP28
promoting the “beginning of the end” of the fossil
fuel era, setting goals of tripling renewable energy
capacity
and
doubling
energy
efficiency
improvements by 2030.
2024 will be a crucial year for implementing climate
action plans and other initiatives to support the new
disclosure regimes and associated economic
imperatives. Industry players seem poised to
coalesce around bankability and market standards
for newer segments of energy transition, such as
critical minerals mining, hydrogen, P2X, sustainable
aviation fuel, and direct-air capture.
Meanwhile, traditional energy sources will continue
to play a major role both in the energy industry and
in driving M&A activity, as increases in global energy
demand outpace growth in clean energy. We also
expect another busy year for upstream M&A,
including spin-off activity resulting from the
blockbuster 2023 Chevron and Exxon M&A
transactions.
See our Energy Transition Hub for more insights.
Life Sciences and Health Care
The M&A landscape in the life sciences and health
care sector is primed to remain robust in 2024,
especially in the pharmaceutical and medical device
spaces where buyers maintain very strong balance
sheets. Advancements in biotechnology innovations,
including in areas beyond traditional drug
development, such as gene editing, cell therapy, and
RNA-based therapeutics, are expected to propel
strategic acquisitions and partnerships.
The integration of digital health technologies will
continue to reshape health care delivery, with
significant investment expected in telemedicine,
health data analytics, and AI-driven diagnostics.
Next-gen technologies that facilitate product
development are also expected to be a focus area
for buyers. As a result of regulatory challenges
and unknowns for such products, companies who
have addressed regulatory hurdles early in their
life cycle will be of particular interest to buyers.
The sector will continue to prioritize transactions
that improve supply chain resilience and enhance
manufacturing capabilities for pharmaceuticals and
other health care products. Cross-border deals are
also anticipated to increase in volume as companies
seek to diversify and expand globally into new and
developing markets. In parallel, private equity
activity in the life sciences and health care sector is
also expected to grow throughout 2024.
