On Monday, I blogged about the Top 10 trends for the US – below are some trend thoughts from Torys:

As explained further in this memo, we predict that 2010 will be remembered as a comeback year with significant M&A activity. While 2009 was a slow year in the M&A space, in 2010 the pickup in M&A activity will be considerable.

We expect activity to include acquisitions in the “green” and media and telecom sectors. Life sciences will continue to be robust though mid-market focused. Well-run Canadian pension funds and banks will also take advantage of their relative strength to make international acquisitions. Large conglomerates, including financial institutions, will carve out their non-core assets. Private equity is also showing signs of renewed interest in acquisitions.

Although foreign buyers will face some scrutiny from the Canadian government when national security issues are triggered, “national security” will not be viewed as broadly as was once feared. Canadian M&A deals may also face more lengthy and onerous antitrust reviews.

In 2010, shareholders will continue their unprecedented level of activism, which began in 2009. Canadian directors may experiment by trying to “just say no” to unsolicited offers, while recent developments suggest that U.S. directors may tread more cautiously on this front.

– by Steven Haas, Hunton & Williams

On December 22nd, the Delaware Court of Chancery issued an important decision in NACCO Industries v. Applica, where it refused to dismiss claims brought by a jilted buyer against a target corporation for breaching the no-shop provisions of a merger agreement. The potential buyer alleged that the target failed to comply with notice requirements set forth in the merger agreement when the target responded to, and eventually accepted, a topping bid from hedge fund Harbinger Capital Partners. Here is our client alert – and the opinion.

Equally important, the Court refused to dismiss the potential buyer’s common-law fraud claims against Harbinger based on allegedly false statements made in Harbinger’s Schedule 13D filings. The potential buyer claimed that Harbinger had fraudulently concealed its intent to acquire control of the target, and the Court concluded that federal courts do not have exclusive jurisdiction over false statements in SEC filings. The Court also refused to dismiss the potential buyer’s claim that Harbinger tortiously interfered with its merger agreement with the target by, among other things, publicly misrepresenting its acquisition intent and colluding with the target’s officers who were breaching the merger agreement.

The decision demonstrates that Delaware courts will enforce reasonable deal protections to give parties the benefit of their agreement. Going forward, it should also cause activist hedge funds and some private equity funds to evaluate their disclosures carefully. The decision raises many other interesting issues, however, such as the proper calculation of the potential buyer’s damages against the target and whether the potential buyer’s reliance was reasonable. It is also important to note that, because the opinion ruled on a motion to dismiss, the Court was required to assume the truth of the allegations in the complaint, which purported to quote several of Harbinger’s internal emails that appeared inconsistent with its SEC disclosures (for Harbinger’s response to the opinion, see DealBook’s article.

Recently, PricewaterhouseCoopers Transaction Services released its annual year-end U.S. M&A forecast for 2010.

How accurate was the PwC Transaction Services 2009 M&A forecast? Here is what PwC says about that:

1. Troubled companies will look to align with larger, stronger players in order to survive, creating the perfect storm for mergers of necessity

Correct. 2009 saw patient buyers take advantage of favorable pricing to achieve their strategic goals.

2. Innovation will be a key for private equity to evolve as an industry in 2009.

Correct. Private equity firms have succeeded in getting creative to gain control of businesses through nontraditional means. Taking control of debt positions became a tool of choice by private equity to gain control of a company.

3. The new administration and the stimulus plan would generate opportunities for both private equity and corporate buyers in healthcare, technology and energy.

Too early to call. We may have overestimated the speed to which the stimulus would flow into the economy. We’ll see what 2010 holds.

4. More traditional consolidation will drive results in financial services in 2009.

Partially correct. There were some consolidation plays in banking and asset management; however, overall deal value was not significant related to recent years. The FDIC-assisted bank deals led the stats in terms of numbers.

5. Automotive and oil & gas M&A activity will remain quiet.

Correct. M&A activity was stagnant in these industries.

6. Emerging markets will lead us out of the slump in deal activity with Brazil, India and China as the key regions of focus for those who sat on the sidelines over the last five years.

Partially correct. It was certainly true for the equity markets in these regions. The jury is still out on the extent of emerging market M&A.