We do a significant amount of business with the M&A
areas of investment banks. Based on the day-to-day usage of a number of
databases we have under license, we can get a pretty good feel for how much
global M&A activity is taking place. The numbers are pretty
reliable. Using these metrics, back in September I was planning for a
rough fourth quarter and beginning of 2008. September is usually one of
our strongest months but usage was off by more than 30%. This presaged
the weakness late in 2007. But the numbers have bounced back a bit in the
past few weeks (even accounting for the holidays) and, as we've seen, there
have been a number of deals announced recently.
Despite the turmoil in the equity and credit markets, which has affected
private equity buyers (see chart below), there still seems to be reasonable activity and
lots of opinions about what will happen this year, which I have provided links
to here.
- The Wall Street Journal's Deal Journal posted M&A in 2007: Inside the Numbers on January 3.
- Also on January 3, the FT published Financial Services to Fuel M&A, which predicts that private equity interest in financial services will play a big M&A role in 2008.
- Mergermarket believes somewhat the opposite: there should be Low Expectations for Bank M&A in the First Half of 2008
- McKinsey, in their premium article Deal Making in 2007 - Is The Boom Over? says that "suggestions that the M&A boom has met its demise may be premature. Most of the decline in M&A since August was concentrated in private-equity deals; corporate acquisitions continued apace."
- Deloitte Research just published Strategic Acquisitions Amid Business Uncertainty: Charting a Course for Your Company's M&A which is a guide for strategic acquirers.
- AdMedia Partners recently released Prospects for Media Mergers & Acquisitions.
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