The global mergers and acquisitions market appears to be scraping the bottom and will head upwards in 2014, according to the Intralinks Deal Flow Indicator.
Intralinks tracks pre-announcement early-stage M&A deals across the world, providing a unique predictor of future global activity.
“We continue to be reasonably confident that 2013 will prove to be the bottom for M&A deal volumes and that 2014 will offer much brighter prospects for deal makers,” says Matt Porzio, VP of strategy & product marketing at Intralinks.
He says 2014 could prove to be the year the world finally begins a new cycle of recovery, almost seven years after the onset of the global financial crisis.
The Intralinks Deal Flow Indicator (DFI) tracks global M&A sell-side mandates and deals reaching the due diligence phase prior to public announcement, providing a leading indicator of global deal activity.
The largest announced deal of Q4 2013, the USD 8.2 billion acquisition of US Foods Inc by Sysco Corp, was smaller than the seven largest deals announced in Q4 2012.
The last quarter of 2013 saw a 17 per cent year-on-year increase in the number of early-stage M&A deals globally.
However, this contrasts with a decline of 2 per cent compared to the same quarter in 2012.
Overall, early-stage M&A activity in 2013 was up 15 per cent compared to 2012.
Intralinks also conducted a Global Sentiment Survey, which surveyed more than 1,900 global M&A professionals on their confidence levels for the 2014 deal market.
- Overall, 64 per cent of M&A professionals are optimistic about the 2014 market. 73 per cent predict M&A activity will increase over the next 6 months
- Respondents were least optimistic in Latin America, which is consistent with deal flow levels seen in the Q4 2013 DFI.
- Despite lower levels of growth in Asia Pacific (10 per cent), respondents from APAC showed some of the highest levels of optimism
- 77 per cent of M&A professionals in APAC are expecting an increase in M&A activity in the next 6 months, compared with the global average of 73 per cent
- 70 per cent of respondents expect their companies to participate in more M&A deals than 6 months ago
- 71 per cent expressed optimism about activity right across 2014