Environmental considerations are fostering innovation in materials across the industrial landscape, including packaging, building products, and chemicals. We are seeing a growing materials substitution trend benefiting innovative materials companies, including a client that is making a product out of recycled glass. Winning companies are combining green advantages with superior performance—there doesn’t have to be a compromise.
2023 Outlook - January 12, 2023
Industrials
From the internet of things to temperature-stable packaging, mission-critical components, environmentally friendlier chemicals, and cutting-edge building materials, the industrials space offers a wealth of opportunities. Here, senior bankers from the Harris Williams Industrials Group discuss key trends creating M&A opportunities, especially active subsectors, and buyer dynamics in the industry.
Which industry trends are you watching over the next several months?
One of the most exciting trends in industrials is automation, creating M&A opportunities within industrial technology and packaging. Companies in all sectors are seeing the benefits of automating aspects of production, especially in the context of the tight labor market and the shift toward nearshoring.
Winning companies are combining green advantages with superior performance—there doesn’t have to be a compromise.
Which subsectors do you think will be most active?
Several subsectors within industrials will be active over the next year:
Industrial Technology
Industrial technology is one to watch because of the key role it plays in helping companies manage a tight labor market and productivity.
How are buyer dynamics in industrials evolving?
Inflation is focusing buyers on long-term pricing and earnings dynamics—more than ever, they need to understand what EBITDA will look like at different points in an economic cycle. And, given tighter credit markets, strategic buyers have been playing a larger role in many of our transactions.
Overall, despite market uncertainty, our team is very much engaged with active buyers and sellers. There’s an elevated level of dialogue happening given all the market dynamics at play, with investors looking to put capital to work in top-quality companies.
Contacts
Tim Webb
Group Head
Managing Director
John Arendale
Managing Director
John Lautemann
Managing Director
Eric Logue
Managing Director