Findings from latest Mergers Alliance conference

The UK is better placed to survive the downturn in M&A activity than most of the other major economies in the world, reports Catalyst following the latest meeting of its international partnership Mergers Alliance in Miami, USA (November 2008).

US partner Billow Butler reported that the US mid-market is finding it particularly difficult at this time and is unlikely to see many signs of recovery for the next 18 months. The decline in the value of the pound may be an encouragement to US buyers looking for acquisitions in UK but overall the decline in M&A activity has been significant and Billow Butler are not expecting 2009 to generate many deals.

Other major world economies are also likely to suffer as Andy Currie of Catalyst explains, “China has been a market that has seen substantial growth in recent years and one which we perceived as having the greatest long term potential for generating M&A activity. However the impact of the global credit crunch and continued state intervention means that the anticipated transactions are not going to be achieved."

"In India the situation is different. We have seen remarkable growth over the last five years which has impacted on the UK with a large number of assets being bought by Indian businesses. However, the Indian market is driven largely by bank debt which has become much harder to source hence the Indian market has stalled.”

The conference was attended by over 150 delegates from across the globe including Russia, China, India and Japan. “As the mid-market becomes more international it is important to be able to offer access to overseas buyers and local knowledge on a global basis and this can only be done effectively through well maintained relationships. This conference is one way in which Merger Alliance member firms are able to exchange views to the benefit of their clients.”