New data has revealed that 73 per cent of senior tech, media and telecoms professionals in the UK are concerned about regulatory activity increasing, impacting their ability to carry out deals in 2022.
According to research from the global SaaS provider for the M&A industry Datasite, 49 per cent of the 200 senior UK leaders surveyed said they saw slowed deal activity last year due to regulations like the National Security and Investment Act 2021 and Online Safety Bill.
Consultancy and accounting firms were particularly impacted, with 50 per cent of respondents stating that deal activity had slowed in the past 12 months.
Meanwhile, investment banks buck the trend ,with 43 per cent seeing accelerated deal activity in 2021.
With more regulation on the horizon, such as the Global Tech Tax adding to already present regulations like the EU Digital Services Act, the TMT industry will likely be hit hard when it comes to dealmaking.
Merlin Piscitelli, Chief Revenue Officer, EMEA at Datasite, told City A.M.: “The technology, media and telecom space has indubitably been a key driver of M&A activity in the past year.”
“With expected regulation around AI this year, coupled with intense scrutiny on Big Tech and a cascade of global regulations from GDPR in Europe to various individual regimes, the focus on data rights, privacy and security is now sharper than ever.”
“The wave of regulation and reform which will shape digital markets and TMT deals will mean it’s crucial that sellers, buyers, and dealmakers understand how and where regulators may intervene and that they develop a coherent strategy to comply with regulations in multiple jurisdictions.”
He added that it therefore even more crucial to get the due diligence phase of a technology M&A deal done right, to help navigate regulatory compliance and scrutiny to meet deal execution timetables.