A Round-Up of M&A Forecasts

As part of Alacra's business is driven by M&A transaction volume, we keep pretty close tabs on the forecasts for M&A activity.  At least for the first half of the year the outlook isn't pretty, with the exception perhaps of the financial industry.  Here are a few forecasts that appeared recently:

JEFFERIES PUTNAM LOVELL EXPECTS 2009 GLOBAL ASSET MANAGEMENT M&A ACTIVITY TO BE PACED BY DIVESTITURES, DISTRESSED SALES

NEW YORK, January 12, 2009 – Sizable asset management transactions, largely absent in 2008, are likely to reappear in 2009, driven by distressed selling of investment divisions by commercial banks and insurers, consolidation among alternative firms, and opportunistic buying by financial players that are emerging with fewer wounds from a historic and ongoing global credit crisis, according to Jefferies Putnam Lovell, the investment banking group of Jefferies & Company, Inc. focused on the asset management and financial technology industries.      More here.

GLOBAL MID-MARKET M&A OUTLOOK

The M&A landscape has changed dramatically over the past several months. Debt funding for deals has dried up and deal activity has decreased accordingly, especially the debt heavy deals that characterized previous years. M&A in the midmarket, on the other hand, could respond differently to the credit crunch given its smaller deal values. To explore how M&A activity in the global mid-market might look in the coming months, Merrill Corporation commissioned mergermarket to undertake Global Mid-Market M&A Outlook.

As you will discover in this report, respondents from North America, Europe and Asia are divided over the prospects for global mid-market M&A. While 43% expect a slowdown, 35% expect activity to increase, and 22% believe it will remain the same. Respondents are slightly more optimistic regarding cross-border deals. Furthermore, 43% of respondents expect the mid-market to see an uptick in cross-border activity this year, compared to 28% expecting a decrease. (The report is here but you need to register.) 

KPMG SEES COMPANIES STRUGGLING TO MAKE DEALS

The mergers and acquisitions “Predictor” has spoken, and the forecast isn’t pretty. The accounting firm KPMG’s Global M&A Predictor, a forward-looking survey that takes the financial pulse of 1,000 leading companies, shows a significant reduction in companies’ willingness and ability to make deals in 2009.

“Findings from our latest Predictor confirm our view that 2009 will be a very subdued year for M.&A. activity,” Stephen Barrett, corporate finance chairman at KPMG, said in a statement. “We expect global deal volumes to continue to fall through to the third quarter and, with less liquidity in the market and reduced debt market liquidity, appetite and capacity for doing deals will continue to decline.”  More from DealBook.