Survey examines how AI will impact mergers and acquisitions

SS&C Technologies Holdings published a report that examines how artificial intelligence (AI) is used to facilitate mergers and acquisitions (M&A).

Ther SS&C Intralinks 2024 Artificial Intelligence in M&A Report had several key findings. Among them, it found that the majority of participants (97 percent) believe AI will profoundly impact their operations and how they run M&A processes. Also, about a third of the respondents are early adopters, confident in AI’s transformative potential and its practical applications for their businesses.

In addition, it revealed that talent and skills are seen as the biggest stumbling blocks in AI adoption in the next 12-24 months, with 18 percent of respondents citing the need to recruit and retain knowledgeable personnel. A further 17 percent point to the need to train existing staff so their firms can move on from legacy technologies.

Also, nearly 43 percent say they’ve already invested in AI training for deal teams. A third of the respondents (32 percent) intend to consider restructuring deal teams and their responsibilities as AI adoption accelerates.

Further, 25 percent of the respondents cite quality control and reliable performance as the top risks associated with AI adoption, while 19 percent point to data security and privacy as a key issue.

“The rate of AI adoption in M&A has been intense and is unlikely to slow down anytime soon,” Bob Petrocchi, co-head of SS&C Intralinks, said. “M&A professionals believe AI is going to change every aspect of dealmakers’ work. The extent of their ability to exploit these novel technologies will be a factor in their ability to stay ahead of competition.”

The report also highlighted viewpoints on practical applications for AI within dealmaking. Among them, it found that predictive analytics and generative AI are the most valuable AI tools for M&A dealmakers, followed closely by machine/deep learning.

Also, 23 percent of all respondents believe AI can help generate more accurate and dynamic valuations by analyzing financial data, industry trends and competitor information.

Further, roughly 30 percent believe advanced predictive analysis and modeling will be a key trend shaping the future of AI’s use in dealmaking, while 25 percent think the growth of generative machine learning algorithms will be influential.

Finally, 25 percent of all respondents think AI will most impact data analysis, while 16 percent contend that AI will be most important for risk and opportunity identification.

The results came from surveying 300 global M&A dealmakers from 225 corporations and 75 private equity firms in the first half of 2024.

SS&C, based in Windsor, Conn., is a global provider of services and software for the financial services and healthcare industries.

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