Merger and acquisition activity in the Accounts Receivable Management industry remained relatively flat in the first quarter, compared with the fourth quarter of 2019, largely due to the resilience of the industry, and continued interest in the space remains “very much alive,” according to a report issued by Corporate Advisory Solutions this week.
A copy of the report is available by clicking here.
Overall, the number of deals and the total deal value in what CAS calls the “Outsourced Business Sector,” which includes the ARM industry, the Revenue Cycle Management industry, and the Customer Relationship Management industry was lower during the first three months of 2020, compared with the last three months of 2019. The total number of deals in the first quarter was also lower than the number from the first quarter of 2019, but the total deal value was higher this year than last.
All eyes, however, are now focused on what will happen during the second quarter and beyond, given that the economic shutdown across the country began as the first quarter was ending. There are several factors that bode well for the ARM industry over the short- and long-term, CAS noted in its report.
“Despite the challenging times, it is anticipated ARM service providers will play a significant role in helping the economy recover as the resolution of debt obligations becomes more complex and critical in keeping struggling
businesses afloat,” wrote the company in the report. “CAS also anticipates debt sales to increase as originating creditors look to supplement short-term levels of depressed liquidation and raise much needed cash flow. In anticipation of this, many debt buyers are looking to optimize their workflow and seek additional capital to help fund these purchases. The ARM industry is poised to see record inflows of referrals/placements as the country grapples with unprecedented delinquencies.”
