{{item.title}}
{{item.text}}
{{item.title}}
{{item.text}}
The value and volume of deals in the transportation and logistics (T&L) sector declined by 82% and 33% respectively in the last 12 months through November 15, 2023, compared to FY 2022, with both standing at about half of pre-COVID levels. Although average deal values remained at FY 2022 levels, there were only 7 deals over $1 billion in the 12 months preceding November 2023 compared to 29 of that size in FY 2022. Only the airfreight and logistics subsector recorded deal values approaching pre-COVID levels.
Strategic investors far outpaced financial buyers in making deals. They were responsible for 80% of all deal value compared to about 50% in the years pre-COVID.
As seen in other sectors, the slowdown in T&L dealmaking comes in the face of headwinds from an increased cost of capital and continued uncertainty about economic and geopolitical prospects. In addition, dealmaking has yet to recalibrate after a cycle of increased demand, capacity constraints and historically high freight rates followed by a reverse in many aspects of those drivers. In response to these changing dynamics, many companies focused a great deal of attention — and investment — on bolstering supply chain resilience.
We believe dealmaking opportunities will continue to emerge in 2024. Technology-infused deals that carry the promise of transformational returns will likely continue to be attractive, and strategic buyers may be well positioned to take advantage of such opportunities. Additionally, investments in last-mile delivery capabilities are likely to remain a key focus for companies, as e-commerce purchases have shifted from traditional “big and bulky” goods and non-perishables to food and beverage products and pharmaceuticals.
Note: The primary M&A data source used in the year-end outlook is S&P Capital IQ. This is a change from our past outlook reports.
“T&L dealmaking is at multi-year lows as participants continue to recalibrate expectations.”