Increased confidence in the global dealmaking backdrop is driven by the favorable performance of the capital markets; a significant majority (over 80%) of industry executives believe corporate earnings, equity valuations and credit availability will further improve over the next 12 months, even in the face of negative headlines speculating about potential macroeconomic softness and geopolitical instability.
This positive perspective is translating into a strong outlook by media and entertainment executives for growth — 95% say the economy is improving (up from 48% in October 2018), a sharp counterpoint to worries raised by many economic and business commentators.
Era of active portfolio reshaping
The imperative to build agility and resilience into the enterprise is resulting in an increased frequency of detailed portfolio reviews. Almost half of media and entertainment companies (49%) are evaluating their business mix on a quarterly basis, up from 23% in October 2018. M&A is serving as a catalyst to create meaningful operational change in an accelerated manner. Executives report that these reviews resulted in targeted investments — including inorganic investment via acquisitions — in high-potential business units.