JPMorgan Chase & Co. (JPM) Vice Chairman Jimmy Lee sees “more very large transactions” including mergers and acquisitions, leveraged buyouts and activist activity as capital costs stay low and investors pursue growth.
“Acquirer stocks sometimes are going up when they announce the deal,” Lee said today in an interview with Bloomberg Television’s Betty Liu, citing Advance Auto Parts Inc. $2 billion acquisition of General Parts International Inc. as an example. “That is a message that the buy-side is sending boardrooms, saying ‘we will invest in growth’.”
Lee, the longtime chief of investment banking at JPMorgan Chase who advised Dell Inc. on its buyout led by founder Michael Dell, said today’s markets would accommodate a $25 billion leveraged buyout “quite readily,” and described the cost of capital as “exceptionally low.”
“Deals have gotten bigger here in the U.S, there’s been more of them, and I do think that there’s going to be more very large transactions going forward,” Lee said.
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