M&A To Heat Up, Although Investors Look Abroad

The Business Ledger - Activity in mergers and acquisitions, which reached new heights in 2006, will continue to increase this year, but many investors may want to look to certain foreign economies for financial growth, as many are growing much faster than the United States, said a panel of experts.

“Merger and acquisition activity is strong,” said Eric R. Lundstrom, founder and president of Focus Capital Advisors, Inc., speaking at The Business Ledger’s first Newsmakers’ Forum of 2007. “Our clients are making more money this year as opposed to last year. Profits are up and overall value is up.” Read More.

Torrid Canadian M&A scene bolstered by budget

March 26 - Investment News - The federal budget unveiled last week allows the Canadian government to remove withholding tax on arm’s-length interest payments under the Canada-U.S. Tax Treaty and with other countries. “This will increase capital inflow into Canada by reducing the tax burden a company has to pay,” said Heather O’Hagan, associate tax partner at Toronto-based KPMG LLP, part of KPMG International. Read More.

Is M&A the New R&D?

March 21 - BusinessWeek.com - Big companies can benefit from buying startups when it gives insight into market dynamics and puts them at the leading edge of industry innovation, says Julie Meyer.

Something new is happening in the way technology innovations are getting bedded down in the industry. Briefly put, venture capital-backed startups are being acquired much earlier in their development by larger companies that offer entrepreneurs a rapid path to growth and scale. For big corporations, in turn, startups help create a "mixed economy" of innovation, balancing the greater certainty of in-house research and development and organic growth [and its longer time horizon] with an earlier but riskier starting position in emerging technologies. Read More.

M&A activity continues strong in Arizona

March 21 - The Business Journal of Phoenix - According to a new study, Arizona mergers and acquisitions activity jumped 18 percent last year. The Columbia West Capital's annual Arizona Deal Survey, reports that 2006 M&A transactions disclosed for companies headquartered in Arizona grew from $10 billion in 2005 to $11.8 billion last year. Growth was driven by both an increase in the number of deals as well an increase in the average deal size. Read More.

Global M&A confidence high despite Europe LBO fall

March 23 - Reuters - Bankers are still expecting a surge in global M&A, despite a steep drop-off for European private equity deals during the first quarter, with cheap debt still plentiful and CEO confidence riding high. Global M&A volumes rose slightly in the first quarter as an uptick in U.S. activity offset a slowdown in Europe, according to preliminary data released on Friday by market research firm Thomson Financial. Read More.

Torrid pace of oil patch mergers cools

March 16 - GlobeAndMail.com - Mergers and acquisitions by global oil and gas producers slumped in the second half of last year after a torrid pace in the first half, setting the stage for a "frustrating" 2007, a report from two industry research firms said yesterday. Fuelled by record cash flow and earnings, global oil companies concluded roughly 280 major upstream transactions, worth $166-billion (U.S.) in 2006, said the report from Houston-based John S. Herold and London-based Harrison Lovegrove & Co. Ltd. Read More.

Beer Distribution Mergers More Likely

March 16 - Chron.com - A Bear Stearns analyst said Friday a single-distributor model for beer may be moving toward reality with brewer Anheuser-Busch Companies Inc. emerging as a big winner. Analyst Carlos Laboy said in a note to investors that several market factors are helping create an environment that's favorable to more industry consolidation. Read More.

Cisco Takes Battle to Redmond and Beyond

March 16 - E-Commerce Times - Cisco has agreed to pay a pretty penny for WebEx. By any measure, the US$3.2 billion -- in cash -- represents a hefty premium. The company obviously has big plans for this product line. Either that, or it wanted to take WebEx off the market so no one else would acquire it. Or both.

The acquisition suggests that Cisco is looking to acquire greater market share among SMBs, agreed Paul Bodet, an analyst with RSM EquiCo, a global investment banking firm.

"This capability will make Cisco a lot more attractive to smaller companies," he told the E-Commerce Times, "who typically consider it to be a vendor for large enterprises only." Read More.

M&A activity to remain strong in Asia Pacific in 2007: S&P's

March 15 - Channel NewsAsia - The current volatility in financial markets should not affect merger and acquisition activity in the Asia Pacific over the long term. In fact, Standard & Poor's believes M&A activity in the region will continue to remain strong in 2007, with China likely to reach fresh records. Read More.

Half of small and medium-sized companies need to get more value from their audit

March 16 - Business Credit Management - UK - New research by KPMG has found that around half of small and medium-sized companies are not extracting the value that they could from their audit. Fifty-six percent of the 200 small and medium-sized companies surveyed see their audit as a largely mechanical process that is more or less exactly the same each year, while only 40 percent of companies agree that the audit brings up recommendations and learning points useful for the business as a whole. Read More.

European mid-market M&A expected to increase in next six months - KPMG survey

February 26 - Forbes.com - European mid-market mergers and acquisitions are expected to increase in coming months, although the private equity sector is less confident than the corporate sector, a survey said.

Research by KPMG International showed that 58 pct of private equity respondents expect M&A to grow in the next six months, compared with 67 pct of the corporate sector respondents. Read More.

Canadian M&A activity hits record in 2006

February 26 - CBC News - Canadian companies were involved in a record $257 billion worth of merger and acquisition activity in 2006, according to an investment bank that tracks takeovers.

That eclipsed the previous M&A record of $234 billion set in 2000 during the height of the dot-com boom.

Investment bank Crosbie and Co. said private equity groups are taking a keen interest in the takeover market. Read More.

Takeovers off to good start in 2007

The rumors about a potential takeover of aluminum producer Alcoa Inc. this past week created an enthusiastic buzz on Wall Street that acquisitions this year will smash the $4 trillion record set in 2006.

Seven weeks into 2007, the amount of money for takeovers brokered by investment banks and private equity firms is trending above last year. In the U.S., market researcher Dealogic said volume has soared 86 percent to $228.6 billion from last year, while global volume rose 36 percent to $477.4 billion. Read More.

Builder-sector M&A on hold

February 9 - MarketWatch.com - Merger-and-acquisition activity in the home-building industry has ground to a standstill, but companies continue to eye deals and will likely kick off a "frenzy" of transactions late this year or early in 2008, an M&A expert said Friday at the International Builders Show.

Home-building firms have been cutting back their land positions, limiting exposure to overheated markets and adding cash to balance sheets since the housing market went into decline last year, positioning themselves for recovery, said Jody Kahn, who works with Michael P. Kahn & Associates in Ponte Vedra Beach, Fla. The firm has been involved in 86 home-building M&A deals. Read More.

2007: A record year for oil mergers?

February 9 - CNNMoney.com - Spring is less than six weeks away, but love is in the air again in the nation's oil and gas industry. Fueled by last year's record highs for crude oil, low interest rates and a sea of private equity money, 2006 brought 485 mergers in the energy patch, the most in 16 years - deals worth a cool $82 billion, the fourth highest over that span. Read More.

RSM EquiCo discusses Aerospace & Defense in its Q4-2006 industry review

RSM EquiCo discusses Aerospace & Defense industry trends, Merger & Acquisition highlights and transaction values during Q4-2006.

Read the complete report.

What Does The M&A Boom Mean For The Market?

February 8 - SeekingAlpha - The 2000 merger boom was known not only for the number of deals completed but also for a lack of discipline and the number of deals that destroyed value for shareholders... Are shareholders doing any better this time around? They appear to be. Read More.

2007 to Become Record Year for Mergers: Apply Best Practices For M&A Success

January 29 - PRNewswire - The new year has just started and already the news is filled with upcoming mergers andacquisitions; companies in every industry are spending billions identifyingand acquiring new entities with the goal of growing market share, product portfolios and long-term profits. And market conditions in 2007 have notbeen this favorable for M&A deals since the late 1980s. However, deals are often struck without careful planning of theaftermath. Integrating two independent businesses, strategies, cultures andsystems to run smoothly under one roof is an underestimated task with manyobstacles. Read More.

Private equity to drive 2007 M&A activity

January 29 - LawTimes.com - Now that the government has effectively shut down the income trust market, what will drive Bay Street in 2007? Weep not for big law firms. The market is not expected to cool down anytime soon. Torys LLP, Blake Cassels & Graydon LLP, and KPMG LLP have all weighed in with studies examining upcoming mergers and acquisitions activity in 2007. They expect activity to increase and predict that private equity deals will play a more prominent role in capital market activity this year. Read More.

Small deals to dominate 2007 utility M&A

January 26 - MergerTalk - Small takeovers by investment funds and sales of unregulated power plants will be a large part of utility mergers and acquisitions this year as companies try to navigate the changing regulatory and environmental scene.

The risk of higher environmental costs, uncertainty about natural gas pricing, and concerns about having enough capacity to meet future demand will drive such deals, industry lawyers and experts said. Read More.