Industrial Distributor M&A Pulse – Q4 2022

Q4 2022 – M&A Returning to Normalized Levels

U.S. and Global Industrial Distribution M&A volume declined in the fourth quarter of 2022, compared to the record-setting Q4 2021 period. Globally, M&A activity posted 175 closed transactions for the quarter, a sharp 36% decline from 272 in Q4 2021. The U.S. tracked similarly, recording 88 closed transactions, down 39% from 144 in Q4 2021. Despite this year-over-year fourth quarter decrease, M&A activity still outpaced healthy pre-pandemic levels with U.S. M&A volumes finishing the quarter 11% above pre-pandemic Q4 averages of ~79 transactions (2017 to 2019 Q4 average).

Monetary policy measures aimed at curbing rapid inflation have started to take hold with the YoY Headline CPI index growth slowing to 6.4% in December 2022 down from 9.0% in June 2022. This has also contributed to other manufacturing sector indicators pushing into contractionary territory with the Institute for Supply Management (“ISM”) Production Index falling to 48.5 in December 2022, down from 50.6 in September 2022. The ISM Purchasing Managers’ Index also fell into contractionary territory finishing the year at 48.4, down from 50.9 in September 2022, while the ISM New Orders index remained in contractionary territory finishing the year at 45.2, down from 47.1 in September 2022.

Read Industrial Distributor M&A Pulse Q4 2022 Full Report