There may only be a few weeks left of 2015, but already the total value of global merger and acquisition activity has hit a record high of $4.2 trillion. Such has been the deal bonanza in a host of sectors from pharmaceuticals and telecoms to oil and gas that this year has already surpassed the all-time annual record for global deal-making set in 2007, according to Thomson Reuters. The global information group added that since records began in 1980, only six transactions had surpassed the $100 billion mark and two of these were announced this year alone.
With low interest rate environments and cheap financing persisting in many economies, many believe this surge in M&A deal-making is only going to increase next year. However, history and hindsight has long shown that M&A can sometimes be foolhardy pursuits damaging once-healthy companies and leading to the destruction of shareholder value.
In every sector there are examples of M&A transactions where companies have overpaid, failed to properly integrate or taken on so much debt it crippled operational flexibility. As the M&A industry rounds off a golden year, the questions that need to be asked now are whether this is a vintage time to invest or should companies and their banking advisers be treading with caution?
M&A Outlook 2016, in partnership ACG, is a 16-page report empowering business leaders with thought-leading analysis into the evolving M&A landscape, featuring high-impact data visualization and immersive editorial from award-winning journalists. The publication serves as a fundamental compendium to current state of M&A, exploring recent mega deals, business valuations, tensions in private equity and due diligence.
Access the full M&A Outlook 2016 report here.
James Wilkinson is publishing manager for Raconteur, a publishing house and content marketing agency that produces special reports for The Times and The Sunday Times, as well as content marketing solutions for brands and bespoke market research.
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