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Private equity to turbocharge M&A activity with spotlight on mining services

A wall of untapped capital from private equity is expected to energise deal-making activity over the next 12 months even as markets face into macroeconomic headwinds such as inflation, rising interest rates and geopolitical instability.

After bouncing back to record levels last year since the lows of COVID, 2022 was always going to be a more challenging year for M&A.

But while a drop-off is somewhat inevitable, deal activity levels will remain high as companies look to grow their portfolios. Large cash reserves on balance sheets, strong debt markets and deep pools of cash from private equity will provide tailwinds in getting deals over the line.

Independent law firm Corrs Chambers Westgarth anticipates there will be around 44 deals over $25 million in the 2022 calendar year — down from 64 the previous year. The year is off to a solid start, with 26 deals over $25m announced as of July 31.

Takeover target MACA this week announced it had rejected NRW Holdings’ $375m cash and scrip offer but on Friday said it remained open to takeover talks. The mining services provider has agreed to an all-cash takeover bid from privately-owned Thiess worth $350m.

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