In this M&D M&A Industry Update, we explore the M&A activity and projections for the Engineered Components Area of Expertise within the M&D industry. Our Manufacturing & Distribution Practice experts share their insights on the current state of the Essential Services M&A market and look at the factors influencing the broader M&D industry.
Select Insights:
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M&A Activity Showing Signs of Recovery – Engineered Components (EC) sector deal volume increased 1.2% in 2024, marking the first annual uptick since 2021. While still below historical highs, this reversal signals improving market conditions and renewed buyer confidence. Stronger balance sheets among buyers and increased access to financing have contributed to the rebound, particularly for well-positioned targets.
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Buyers Focused on Differentiated Assets – M&A interest remains strongest for companies offering proprietary, high-value engineered solutions, particularly in Aerospace & Defense, Infrastructure, Data Centers, Medical Devices, and Specialty Chemicals. Businesses with recurring revenue, strong IP, and entrenched customer relationships continue to command the highest valuations.
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Valuations Trending Upward – The average deal multiple reached 9.3x EBITDA in Q4 2024, with premium assets transacting at higher levels. Public EC companies also remain strong, with the Objective EC Index trading at 17.1x EBITDA, outperforming broader equity markets and reinforcing investor confidence in the sector.
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Macroeconomic Tailwinds Supporting M&A – Real GDP grew 3.1% in Q3 2024, with 2025–2026 forecasts revised upward to 2.3%. The ISM Purchasing Managers Index is improving, signaling renewed strength in industrial demand—an encouraging sign for EC businesses and M&A activity.
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Outlook – With valuations rising and economic conditions stabilizing, the EC sector is positioned for sustained deal activity. Companies with technological differentiation and exposure to high-growth end markets remain well-positioned for strategic interest.
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To read the full Engineered Components Industry Update, download below
If you are interested in discussing any of the analysis from this report, or if you would like to discuss your own transaction goals contact the Managing Directors from our M&D Industry Practice below, or reach out at (800) 849-7010 or [email protected] to be directed to the appropriate team member.
Dan Shea
Managing Director, M&D Practice Leader
(310) 903-2163
[email protected]
Disclosure
This news release is for informational purposes only and does not constitute an offer, invitation or recommendation to buy, sell, subscribe for or issue any securities. While the information provided herein is believed to be accurate and reliable, Objective Capital Partners and BA Securities, LLC make no representations or warranties, expressed or implied, as to the accuracy or completeness of such information. All information contained herein is preliminary, limited and subject to completion, correction or amendment. It should not be construed as investment, legal, or tax advice and may not be reproduced or distributed to any person. Securities and investment banking services are offered through BA Securities, LLC Member FINRA, SIPC. Principals of Objective Capital are Registered Representatives of BA Securities. Objective Capital Partners and BA Securities are separate and unaffiliated entities.