M&A Deal Timelines Rise Across The Globe – Corporate and Company Law
GP
Goodwin Procter LLP
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Anecdotally, M&A deals across the board appear to be taking longer to close, but data segmented by deal size is limited; however, the data we do have on larger transactions shows that average timelines…
United States
Corporate/Commercial Law
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M&A closing timelines are lengthening worldwide amid
heightened regulatory scrutiny and increased due diligence
requirements.
Anecdotally, M&A deals across the board appear to be taking
longer to close, but data segmented by deal size is limited;
however, the data we do have on larger transactions shows that
average timelines have extended significantly.
The period between signing and closing has risen for M&A
transactions exceeding $2 billion, according to a recent analysis
by the Boston Consulting Group. The increase is most pronounced for
the largest deals, with those over $10 billion taking 27% longer to
close than deals valued between $2 billion and $10 billion.
Deal timelines for transactions exceeding $10 billion have
lengthened globally. In the Asia-Pacific region, it took an average
of 452 days for such deals to close in 2022, a 125% increase from
the 2018-2020 period. US and European deal timelines rose 66% and
19%, respectively, over the same timeframe.
Extended deal timelines reflect heavier regulatory scrutiny and
an increased focus on detailed due diligence globally. Recent
regulations, such as the EU Foreign Subsidies Regulation (FSR),
have introduced additional complexities and potential delays to
transaction timelines.
Prolonged closing timelines can tie up capital, increase
transaction costs, and delay returns. Thus, managing the interim
period between signing and closing is increasingly critical in
M&A transactions. For strategies to navigate these delays and
successfully close deals, see our piece “How to Navigate Deal Delays and Completion
Uncertainty in an Era of Heightened Deal Complexity and Prolonged
Interim Period.”
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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