Robot M&A May Be in Post-Pandemic Future
As hard-hit markets stabilize, industrial dealmaking will reflect a changing landscape, says Houlihan Lokey.
New needs on the factory floor may spur M&A in robotics, automation and more.
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Industrial dealmaking, like a lot of M&A, has been practically nonexistent since the coronavirus pandemic hit with full force in mid-March. There have been $79 billion worth of industrial takeovers so far this year in North America and Western Europe, down from more than $230 billion of transactions at this point in 2019. Tellingly, the two biggest manufacturing deals of 2020 — the $19 billion private-equity buyout of Thyssenkrupp AG’s elevator unit and the merger of Bombardier Inc.’s rail unit with Alstom SA. — comprise about a third of this year’s total. Since March, a mere $18 billion of purchases have been announced, with most companies opting to instead preserve cash and err on the side of caution. Buybacks, capital investments, M&A plans and travel budgets — basically any form of spending that wasn’t 100% necessary — all got put on ice or sharply curtailed.