August 1, 2020 — Firm News
The COVID-19 pandemic dramatically altered the mergers and acquisitions landscape in the staffing industry during 2020. After a robust 2019 with nearly 150 reported transactions, activity slowed considerably following March's onset of the global health crisis.
Industry analysts projected approximately 20% revenue declines across staffing sectors in 2020. According to Duff & Phelps' Summer 2020 report, only 58 transactions occurred in the first half of 2020 -- a nearly 20% decrease from the same period in 2019. IT staffing led with 22 transactions, followed by Light Industrial with 10 and Healthcare with 7.
Despite initial slowdowns, activity rebounded in subsequent months as companies adapted to pandemic conditions. Elie Azar, founder and CEO of White Wolf Capital, observed "We are definitely seeing a meaningful uptick in the number of deals that come across our desk versus the prior year."
White Wolf remained particularly active, completing four add-on acquisitions by mid-2020 and pursuing four additional deals. The firm's defensive, essential-focused portfolio -- concentrated in defense and infrastructure industries -- weathered pandemic impacts relatively well.
Azar emphasized that successful acquirers required strong cultural alignment with management teams. He stated the firm sought "growth oriented, motivated management teams that are more interested in that second 'bite of the apple.'"
Virtual meeting platforms effectively replaced traditional face-to-face negotiations, enabling deal closures throughout 2020 despite pandemic restrictions.