The M&A Watch is a quarterly publication offering analysis of the marketplace and climate for middle market mergers, acquisitions and strategic transactions. The goal of this publication is to arm business owners and other parties with insight to help prepare for such transactions in order to maximize transaction outcomes.

Overall, middle market M&A activity for the first six months of 2019 remained on par with activity during the same period last year, but looking ahead, there is some evidence to suggest deal-making conditions will tighten in the second half of this year. There are growing concerns that continuing United States and China trade tensions will impact both the economy and M&A. This dynamic has certainly dampened global growth, and inflation has stalled in the United States.

Here are a few top takeaways Q2:

  1. Equity markets have recovered after their slump in early 2019, and the U.S. Federal Reserve cut interest rates for the first time in a decade.
  2. Q2 2019 multiples rebounded from the drop in Q1 2019, a pattern similar to the first half of 2018.

For the first half of 2019, valuation multiples continued to hold strong, bolstered by the abundance of Buyers compared to Sellers in the market and cheap capital.

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