The past year has been one of the busiest ever for mergers and acquisitions (M&As), and the volume of deals will likely continent to be high throughout 2022. Paul Inouye foretells several expected M&A trends in 2022.
Paul Inouye Has Experience With M&As
Paul Inouye is well-qualified to speak about mergers and acquisitions, as he has more than three decades of experience in the space. Inouye’s career in the financial and technology sectors has included stints at some of the largest banks, including Morgan Stanley, Lehman Brothers, and others. He’s also founded his own advisory firm, which he continues to run as its Chief Executive Officer.
Over the decades, Paul Inouye has been involved with and seen numerous M&As. He’s observed several emerging trends that should continue to play out.
- Many Deals Will Be Digitally Signed
The pandemic accelerated a broad shift toward digital that was already underway, and the M&A space experienced this change just as many other areas of commerce did.
Covid-19 health concerns and lockdowns have made companies more comfortable conducting due diligence, reviewing documents, and signing deals via digital means. Every step from an initial meet-and-greet to final payment is commonly done over the internet now.
As the Covid-19 pandemic eventually subsides, the trend toward digital deals will remain. The convenience of digital meetings and paperwork makes executives’ lives much easier, especially when conducting deals across time zones, countries, or continents.
- SPACs Will Still Be Frequently Used
Paul Inouye notes that a record number of M&A deals were made via Special Purpose Acquisition Companies (SPACs) in 2021. Many companies that want to go public are taking advantage of the faster time frame and more flexible options that SPACs offer when compared to initial public offerings (IPOs). SPACs also give retail investors direct access to newly public companies.
SPACs have come under some scrutiny recently, and the general economic environment is shifting. Even with these changes, however, SPACs will continue to be an oft-used way to go public. Soon, they’ll be a widely accepted option that retail traders, institutional investors, and corporate executives all favor more and more.
- ESG’s Importance Will Continue to Grow
Environmental, social, and governance have just started to be factored in some M&A deals. These do-good factors remain far from the driving force behind many deals, but it’s slowly becoming more and more important.
ESG will shift from a branding talking point to a more important tenant of deals. The transition won’t happen quickly, but a gradual shift will continue throughout 2022 and in the years to come. The shift will be evident as ESG moves from the marketing discussions and into actual deal negotiations.
Watch M&As in 2022
Paul Inouye will continue to be involved in M&As throughout 2022. Watch these trends, and you’ll probably see that he knows this space well.
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