Three out of four executives consider Millennial attitudes and preferences in M&A decision making, according to EY survey
New York, 20 January 2017
Seventy-five percent of executives expect “purpose-driven” mindsets to influence deal strategy
EY Transaction Advisory Services surveyed high level members of the dealmaking community to learn about the current and future impact of Millennials on M&A strategy at the annual Deal Economy conference: Predictions & Perspectives for 2017. The questions were designed to better understand how executives are considering Millennials’ attitudes and preferences in deal making and their influence on business strategy as this generation has a growing role in the economy.
Close to three-quarters (74 percent) of executives surveyed said that they take Millennial attitudes and preferences into consideration in M&A decision making. One in four (26 percent) always take them into consideration, and 48 percent sometimes consider Millennial attitudes and preferences in M&A decisions. The remaining 26 percent reported that this is not a consideration.
In terms of specific attitudes and preferences, three out of four executives surveyed (75 percent) expect that “purpose-driven” mindsets, considered more prevalent amongst the Millennial generation, will change the types of deals that their firm makes to some extent. More than one third (36 percent) expect that purpose-driven mindsets will have an impact and nearly half (48 percent) expect that purpose-driven mindsets may have an impact.
The majority (58 percent) of executives surveyed also reported that their companies have a strategy in place for addressing the impact of Millennials on their respective industries.
“The unique impact of Millennials is increasingly top of mind for executives looking to grow and future proof their businesses, both organically and inorganically through strategic transactions,” said Bill Casey, EY Americas Vice Chair, Transactions Advisory Services. “If we conducted the same survey one year from today, we expect the results would reflect this to an even greater extent.”
Executives had varied opinions on when Millennial attitudes and preferences meaningfully entered discussions on business and M&A strategy. Thirty-seven percent reported that this has occurred in the past two years while 24 percent have only seen the topic of Millennials enter strategy discussions in the past 12 months. Seventeen percent indicated that this shift has taken place in the past five years and 22 percent reported that Millennials are not currently a meaningful consideration for business and M&A strategy.
“What’s also interesting is the dual influence of the Millennial generation on business – both as a growing consumer population with palpable buying power and as rising managers who will continue to bring new philosophies, strategies and mindsets to the C-suite. It will be interesting to watch how these dynamics continue to evolve,” added Casey.
Looking ahead on a sector basis, 28 percent of respondents believe that M&A activity in the technology sector will be most influenced as Millennials play a larger role in the economy. This was followed by consumer (20 percent), media and telecom (12 percent), food and beverage (4 percent), and automotive (3 percent). Thirty-one percent (31 percent) believe that M&A activity in all of these sectors will be impacted by the influence of Millennials.
The survey was conducted at The Deal Economy conference in New York, NY on December 1, 2016 and was based on a five multiple-choice question poll of 89 influential members of the dealmaking community, including corporate executives, investment banking professionals, corporate lawyers, hedge fund managers, private equity investors, consultants and other advisors to private and publicly listed companies.
About The Deal
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