According to the latest Transport & Logistics Barometer, published biannually by PwC Germany in collaboration with Strategy&, the number of mergers and acquisitions significantly declined during the first six months of the year. A total of 86 deals valued at a minimum of $50 million were recorded—12 fewer than in the first half of 2023 and 11 fewer than in the second half of 2023.
“Economic uncertainties, volatile market conditions, persistently high inflation, and new regulatory requirements are pressuring logistics companies to optimize costs and enhance operational efficiency. As a result, mergers and acquisitions have taken a back seat as a means of inorganic, strategic growth,” explained Ingo Bauer, Head of Transport, Logistics, and Tourism at PwC.
Despite the downturn in deal numbers, the total deal value in the first half of 2024 reached $42.5 billion, reflecting an increase in the average deal value to $494.7 million—up from $393.2 million in 2023. The number of mega-deals also rose, with 12 such transactions announced during the first six months of the year.
“The overall increase in prices contributed to the high average deal value. The median sales multiple was 2.4 in the first half of the year, compared to 1.9 in 2023. This development is partly due to exceptionally high multiples in deals involving airports, ports, roads, and targets in the passenger segment,” Bauer emphasized.
The sales multiple for airport infrastructure saw particularly strong performance, rising to 7.2 in the first half of the year, compared to 3.6 in 2023. A key driver was the takeover of Budapest Airport by the Hungarian government and Vinci Airport, which recorded a sales multiple of 10.88.
China’s Decline, India’s Rise
Significant M&A activity was observed in Asia and Oceania, with 43 deals announced in the region, totaling $21.7 billion—exceeding the figures for the entire year of 2023. Notably, there was a high level of deal activity in alternative markets such as Malaysia, India, Indonesia, and the United Arab Emirates, where four mega-deals were announced.
In contrast, China saw only one mega-deal, and its share of deals in Asia and Oceania fell from 45% in 2023 to 30% in the first half of 2024.
“While China remains a dominant player in Asia, its growth is slowing, and the political landscape is uncertain. As a result, other Asian countries such as India and Malaysia are emerging as strong players, with growing wealth, production capacity, and investment opportunities,” Bauer noted.
Africa’s consistently low M&A activity
M&A activity in Africa remains consistently low, a reflection of the continent’s specific conditions. “Africa is an interesting market for certain segments. For example, in the port sector, there has been a shift in target regions, with increased activity primarily occurring in Asia and the Middle East.
However, investments in African ports and terminals are also attracting foreign investors. The fact that this is not reflected in the transaction numbers is partly because many of the transactions fall below our analysis threshold of $50 million or because the transaction values have not been published,” Bauer explained.
Europe in second place
Europe ranked second with 36 deals. Bauer emphasized that strategic investors’ interest in European destinations has increased. According to the report, 11 inbound deals worth a total of $4.5 billion were announced in the first six months, compared to just seven deals with a total value of $3 billion in all of 2023.
Five of these deals were in the logistics and trucking sectors. Notable transactions include the acquisition of British Wincanton PLC by GXO Logistics Inc., the purchase of a 3.12% minority stake in Berlin-based Delivery Hero SE by Uber Eats for $299.29 million, and the acquisition of German and Dutch logistics portfolios by Blackstone Inc. through Clarion Partners LLC for $292.49 million.
“Europe has seen a notable increase in inbound transactions as foreign investors seek access to the European market and its existing infrastructure. A revival in M&A activity is expected once the region emerges from the economic slowdown. Digitalization and artificial intelligence will significantly transform the industry and become increasingly important for all market participants. We anticipate that joint ventures and partnerships, through which transport and logistics companies can advance their digital transformation, will also rise,” Bauer stated.
Outlook: revival of M&A activity expected in second half of 2024
Looking ahead, Bauer is optimistic and expects increased momentum in the second half of the year due to more favorable conditions.
“We anticipate that M&A activity will pick up again in the second half of 2024, supported by easing inflationary pressures and the prospect of future interest rate cuts by central banks, creating a more favorable environment for financial investors. Additionally, the ongoing geopolitical situation, which is expected to persist or even worsen in the second half of 2024, will continue to drive strategic investors to take proactive measures to diversify and consolidate their positions both vertically and horizontally,” Bauer predicted.