Despite record activity in the equity and bond markets, merger and acquisition activity remained low during the first half of 2009, reported Financial Times. Non-financial companies raised 64% more capital on the bond market than at the same time last year, to $887 billion from $540 billion. Banks and other financial institutions raised $89 billion in equity capital with 92 deals, which sets a quarterly record. Besides bank efforts, total equity capital offerings totaled $330 billion, with 1,738 deals, the lowest numbers since 2005 and 2003, respectively. Moreover, merger deals are at their lowest in terms of volume and value since the first half of 2004. Advisers generated $4.9 billion in fees, less than half of the $11.4 billion at this time last year. Boutique M&A firms have increased their share of total revenue to 15% from 13%, but private equity buyouts remain at their lowest levels since 1997 with just $22.9 billion total in 2009. As capital markets gain strength, m&a activity is expected to return. Some advisers predict slow activity for 18 to 24 months.
M&A Activity Remains Stagnant
Despite record activity in the equity and bond markets, merger and acquisition activity remained low during the first half of 2009.
July 1, 2009