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July 22, 2024

Source: S&P Global

The number of terminated private equity-backed deals globally fell 86.2% year over year to just four in the second quarter, according to data from S&P Global Market Intelligence

The decrease in terminated deals suggests a stronger closing momentum in recent periods, as buyers and sellers bridge valuation gaps more effectively.

In 2023, private equity relied on earnout provisions to address valuation challenges. The provisions became less common as sales processes grew competitive, and the economy appeared to be on track for a soft landing, helping to bridge the persistent gap between buyers and sellers in the M&A market.

Canceled private equity transactions are mirroring the broader decline in overall terminated M&A deals. The number of terminated M&A deals without private equity involvement tumbled 77.8% year over year to just 34, marking the lowest quarterly figure since at least 2021.

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