As we enter Q3 2024, the M&A outlook remains optimistic. Deal flow has been steady and is picking up compared to the previous year. According to a recent report by Euclid Transactional (one of our largest trading partners), they received a record number of submissions during April and May.
While deal outlook continues to remain generally positive heading into the second half of the year, insurance rates have remained at all-time lows, making the use of Representations and Warranties insurance highly attractive for buyers. There continues to be excess insurance capacity in the marketplace as new insurers have entered the space, and industry veterans have dropped their rates to be competitive. Initial retention levels are also at all-time lows. As deal activity continues to gain momentum, insurance rates and retentions may increase in the medium to long term.
According to recent reporting by S&P Global, dry powder (or unused cash reserves in the M&A market) has accumulated at an accelerated rate in 2024, even as the outlook on deal-making was greatly...
The number of submissions in the Representations and Warranties marketplace continued to rise in Q2 2024, above the previous quarter. This is consistent with the increase in M&A activity we have seen...
As M&A activity picks up in 2024, the number of Representations and Warranties Insurance (“RWI”) policies placed in the market has increased in tandem. The uptick in activity is driven by the...