By: Rob Wertheimer
Industrial M&A took eight years to reach its prior peak after the 2008-9 financial crisis. At Ametek that downturn in capital deployment lasted only a year, and capital deployed was steadily positive for the rest of the upcycle. Revenue added via acquisition was about 6% from 2010-2019,roughly triple the average industrial. Compounded across a decade, acquisition revenues outpaced the broader industrials by 70%. Gross margin and op margins each rose 400-500 bps at Ametek, pre-financial crisis to pre-COVID crisis, making the capital deployed highly profitable. The difference is meaningful over time, and we expect the same trend, and separation versus the group, to work this cycle