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Laxman Pai, Opalesque Asia: Global merger and acquisition (M&A) activity entering a dry spell appear premature with dealmakers recording the third-highest number of completed deals in an opening six months since 2008, said a study.
According to analysis based on WTW's Quarterly Deal Performance Monitor (QDPM), the only years that have surpassed the 441 deals (valued at over $100 million) completed in the first half of 2022 were 2021, during an exceptional pandemic rebound, and 2015.
Although deal activity has slowed from its record-setting 2021 pace when 484 deals were completed in the first six months, M&A volumes remain buoyant this year with the number of transactions continuing to exceed pre-pandemic levels, according to the QDPM data, run in partnership with the M&A Research Centre at Bayes Business School.
"Deal performance, in contrast, has struggled to defy gravity and has clearly been impacted by market volatility. Amid soaring inflation, rising interest rates, geopolitical tensions, and the ongoing Covid-19 pandemic, buyers underperformed the wider market by -4.8pp, based on share price performance, during the first six months of 2022," said the study.
The average time to close a deal has also increased in 2022, with 60% of transactions during the first six months taking over 70 days (the long-term average time between announcement and closing), compared to 54% in the first half of 2021.
In contrast to last year when competition for assets was...................... To view our full article Click here
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