While many forecast recovery in M&A market, some say growth could be slow

The mergers and acquisitions market gathered significant steam during the second half of 2009 and a number of industry experts expect continued improvement during 2010.

“After having dropped to a six year low at the beginning of 2009, deal activity picked up steadily throughout 2009, suggesting a return to ‘normality’ for North American M&A deal activity for 2010,” a forecasting report by the M&A intelligence service mergermarket states. “The last quarter of 2009 saw the announcement of 831 deals with a total value of $221.7 billion. It was the most active quarter by volume for the year and may act as the catalyst to re-ignite M&A in the region.”

The resurgence in financial sponsor activity, large cash reserves that many corporate buyers are sitting on and continued thawing of the global financial markets are also indicators of continuing improvement in the M&A sector, mergermarket’s report also says.

But even with the improvement seen in the fourth quarter of 2009, deal values were still down about 7 percent for the year – and deal volume was down 26 percent from 2008, mergermarket’s report states.

Read the mergermarket report here.

And according to a recent Bloomberg story, true recovery in the M&A industry may still be several years off.

“If you look at previous M&A cycles, the first year after the trough is always one of gentle recovery before things pick up,” said Dieter Turowski, Morgan Stanley’s head of European M&A.

To read the full story, click http://www.bloomberg.com/apps/news?pid=20601087&sid=autt2l4gCVQc&pos=4

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