This year could witness the return of M&A mania. Appetites were whetted bylast week’s ‘Merger Monday’, which saw circa USD 100bn of announced deals. Would-be rainmakers point to low interest rates, cash heavy corporate balancesheets, high levels of private equity inventory and solid industry surveys asevidence of an imminent return to pre-crisis form. Indeed, notwithstandingadvisors’ claims to ferret-out value, M&A activity tends to be strongly procyclical(chart 1). Macro uncertainty, the main drag of the last two years, hasreceded with Eurozone fears broadly allayed and US policy normalization afoot.
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