With company valuations static and investor confidence divided,
mid-market M&A activity may have reached a peak according to a
new survey of leading private equity investors and senior corporate
executives across the US and Europe.
The Global M&A Cross-border M&A Reporter, commissioned from
M&A intelligence provider mergermarket by Global M&A, the
world’s most active partnership of mid-market independent
corporate finance houses, found that companies and investors
deliberating on the best time to sell a business might be well
advised to act sooner rather than later.
Any slowdown in M&A will not be necessarily prolonged or
profound due to record levels of private equity fund-raising that
will drive the market for some time. There is also a sense that the
cross-border M&A market will move away from the congested and
overvalued territories of Western Europe and the US and look
towards the Central and Eastern European nations and neighbouring
economies such as Turkey.
Other key findings of the Cross-Border M&A Reporter
- Mid-market cross-border activity has slipped back somewhat in
the third quarter of 2006, compared to the previous five
- Fifty-nine percent of global respondents believe that M&A
activity will continue to increase in the next six months, as
opposed to 75% who backed an increase when asked the same question
six months ago.
- Seventy percent still anticipate an increase in cross-border
mid-market M&A activity in their country in the next six
months. This is also down from 83% forecasting an increase six
- Private mid-market and family businesses remain a major source
of deal opportunities for acquirers and investors; however, private
equity portfolios’ have significantly increased in importance
as a source of M&A opportunities – rising to 39% compared
to just 17% six months ago.
- Fifty percent of the respondents raise concerns that the debt
market cannot sustain its current activity, but are divided as to
when the availability of debt will decline significantly –
either Q1 2007 or Q4 2007.
The Cross-border M&A Reporter is published every six months
and is based on 50 telephone interviews with mid-market private
equity professionals and corporate executives in the US and Europe
in September/October 2006. The complete study can be found at
The report was released at the Global M&A Partner Conference in
Istanbul, hosted by Turkish partner firm, Total Finans.
Jeremy Furniss, Partner
Tel: 020 7484 4700