Most U.S. Dealmakers See Volume Drop This Year After Record 2015by
Brunswick survey finds 70% expect N. America activity to fall
Fewer megadeals, cross-border transactions will drive decline
After correctly predicting higher levels of mergers and acquisitions for the past two years, U.S. dealmakers are less bullish about 2016, blaming falling stock prices and economic conditions for their change of heart.
Some 70 percent of U.S. M&A practitioners expect North American deal activity to decrease this year, according to a survey by corporate relations firm Brunswick Group LLP, which also predicted a drop in cross-border transactions.
Globally, the outlook is better. Most dealmakers surveyed (66 percent) expect total M&A levels to match records set in 2015, when buyers splashed out $3.8 trillion on acquisitions, according to data compiled by Bloomberg. Just 13 percent think those records will be beaten this year, down from 54 percent of those who responded in 2015.
The survey polled 140 M&A practitioners and observers from North America, Europe and Asia ahead of the Tulane University Law School 28th Annual Corporate Law Institute, held in New Orleans this week.
While overall deal volume could match last year, rainmakers should expect fewer of the multi billion-dollar megadeals that dominated 2015, according to the survey. More than half (52 percent) of respondents predict that transactions valued at less than $5 billion will make up the majority of deal volume this year, with 40 percent expecting the most activity from $5 billion to $10 billion.
In 2015, about 55 deals worth more than $10 billion were announced, totaling $1.5 trillion, according to data compiled by Bloomberg.