2024 Logistics M&A Outlook
In this report, we share our expectations for 2024, including developments in the market, the outlook for M&A, changes in the process of completing a transaction, and more. Our goal is to utilize our team's expert knowledge to help entrepreneurs evaluate whether 2024 might be the right year to pursue a transaction and to understand how they can prepare their business to achieve an optimal outcome.
The Private Equity / Debt Market Perspective | "...M&A activity will come from companies with cash to grow their business and potentially start up new services. Private equity will strengthen their portfolio companies through strategic acquisitions..." - Ron Lentz, Managing Partner
Freight Forwarding / Custom House Brokerage | "...In short, negotiation power to achieve higher multiples and higher percentages of cash at close if you find the right strategic and cultural fit...Firms with a large footprint, attractive niche business, turn-key management, strong technology, and low customer concentration will be in the highest demand...." - Cris Arens, Managing Partner
Future of Freight Brokerage | "...So, if anything, a number of direct shippers have reanalyzed their model of only dealing directly with carriers and have started thinking about leveraging a network of brokers for competitive pricing and capacity needs moving forward..." - Mark Para, Managing Director
AI & Logistics Tech Trends | "...Both mature technology firms and startups are beginning to implement AI that will change the way their customers interface with information. The winners in this race will have a high degree of interest from potential acquirers while new companies leveraging various forms of AI continue to emerge..." - Max Ibata-Arens, Executive Sponsor
Independent Contractor Regulations | "...In anticipation of these complicating factors and to head off DOL investigations, last-mile delivery companies, and possibly trucking firms using owner-operators, will need to review their IC classification protocols and consider changing their model from IC-based to employee-based..." - Jan H. Raymond, Managing Partner
European M&A Activity | "...We expect the logistics industry to continue to consolidate in 2024 and in the years to come. Most small-to-mid-sized enterprises (“SMEs”) are in a good financial place after a lucrative COVID-era. This has created activity on both the sell-side and buy-side..." - Mikael Olesen, Managing Director
North American M&A Activity | "...From monetary policy shifts and market dynamics to political uncertainties, companies navigating the M&A terrain will need to be agile. While challenges remain, the potential for strategic growth and expansion presents an exciting opportunity for those well-informed and prepared to capitalize..." - Nick Lanza, Buy-Side Director
The Importance of Smaller Transactions | "...This approach of making multiple “small bets” over time has proven to be less risky and to generate higher returns to shareholders. Acquiring companies with a sticky customer base and track record of stable growth is often easier, quicker, and more sensible..." - Matt Laskowski, Signature Sell-Side Director
Timing an Exit | "...The timeline for taking a company to market and reaching a close is also significantly impacted by how prepared the business is for a transaction from an operational, legal, and financial reporting perspective..." - Marijan Ljubic, Executive Sponsor
Successful Due Diligence | "...Time tends to kill deals for various reasons, so a well-organized due diligence can ensure that the process does not drag on and open opportunities for various external factors to affect the decision-making process..." - Tom Gujda, Engagement Director
Seller Notes | "...As external financing has become scarcer, potentially pricing private equity firms out of competition for certain assets, we have noted an increasing willingness by both buyers and sellers to use seller notes as a means of getting a deal done..." - Jake Cunnane, Engagement Director
Valuation Trends | "...Normalizing EBITDA and seller expectations, along with substantial dry powder and hopes for easing conditions in debt markets, will allow financial buyers to re-engage at a higher rate and create compelling opportunities for buy-and-build strategies..." - Kevin Albrecht, Engagement Analyst
Platform & Fiduciary Management | "...Transactions in 2024 will be most successful and expeditious when they are highly process-driven, so think of your M&A event as a symphony. Each section of the orchestra knows their job and does it well..." - Claire Mandell, Administrative Director
Driving Information Drives Value | "...To set yourself up for success in the present, it is essential to both maximize your own knowledge and surround yourself with people who can fill in gaps in your perspective..." - Karin Mellin, Marketing Director