Dealmakers expect their organizations to change their business strategy, including cost reductions in the near term and possible layoffs in the next 12 months, as they prepare for a lengthy downturn, according to survey results from a Datasite Advisory Community poll of global M&A professionals. The Datasite Advisory Community is part of Datasite, formerly known as Merrill Corporation, the leading SaaS technology provider for the mergers and acquisitions (M&A) industry.
On a scale of 1 to 10, dealmakers rank the current economic downturn as an 8.
According to the poll, which included over 100 respondents across the Americas and Europe, the Middle East and Africa (EMEA), dealmakers, on average, rated the intensity of the economic downturn as an eight on a scale from one to 10 with 10 being the worst, with 87% seeing the decline as a seven or higher. Fifty-nine percent said they expect the drop to last longer than seven months. Additionally, 80% of respondents said that the global economic decline is already causing, or likely to cause, significant adjustments to their company’s strategy in the near future, with more than 55% expecting to switch from a strategy of growth to a strategy of maintenance or restructuring.
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“In the immediate term, organizations are focused on remote operating resilience and ensuring they have enough liquidity,” said Rusty Wiley, CEO of Datasite. “Right now, when examining data from our platform, we are seeing more companies move to a deal-ready state, in preparation for post-COVID-19 activity. In addition, we are also seeing an increase in fundraising, restructuring and distressed asset sales.”
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