Below are highlights from Dykema’s 6th annual M&A survey:
– Confidence in the U.S. M&A market is slowly improving for the second year in a row. 38% of respondents predicted a strong market and just 10% had a weak outlook. Confidence was lowest in 2008, when only 16% believed the market would be strong in the following year, down from a high of 63% of respondents in 2006.
– For the second year in a row, strategic buyers (53%) were seen as the group most influencing deal valuations over the previous year.
– Respondents believe strategic buyers are most likely to increase their presence in the M&A market over the next 12 months (51%) and foreign buyers are most likely to decrease their presence (53%).
– 49% say they have been involved in an M&A transaction in the last 12 months that has been adversely impacted by the availability of financing. While financing is still impacting deal cost and delaying closings, respondents do say that lower sale prices and a lack of bidders were less of a problem in 2010, which may signal a sense that increased availability of financing is bringing buyers back into the marketplace.
– China, Germany, India and Canada are named the most likely regions for foreign buyers in the U.S. M&A market over the next year. Respondents named China, Brazil and India as the hotbeds for outbound U.S. M&A activity in 2011.