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Clifford Chance Global M&A Toolkit

Saturday 19 April 2014

Our Insights into M&A Trends - Global Dynamics

M&A - The Global Picture

Whilst uncertainties remain, the market is strengthening and the stars appear to be aligned for a slow and steady recovery in the M&A market in 2014 and beyond.

Matthew Layton
Global Head of Corporate

Although the final quarter saw a slight decrease, the general upward trend in global M&A activity through 2013 reflects the tentative increase in confidence to invest through M&A. Significant uplifts in activity were seen in the second half of this year in Africa (+45%) and the key global markets of the US (+57%) and China (+24%). Looking ahead, the returning confidence and drivers for dealmaking will continue to strengthen M&A activity in 2014.

Positive indicators include increased global economic stability, a calming of euro zone troubles and US fiscal problems, China’s strengthening commitment to becoming a market-driven economy, as well as increasing confidence and focus on growth in both the mature and emerging economies. On a more cautious note political and economic developments have the potential to impact any M&A revival, and there are certainly potential counter-balances to a pick-up in 2014 – the effects of the wind-down of quantitative easing, potentially dangerous asset ‘bubbles’ caused by the low interest rate environment, and the return of the US debt ceiling deadlines, to name a few.

It is also noteworthy that despite the improving economic landscape in recent months, the anticipated pick-up in M&A has been slow to materialise, although M&A activity in January 2014 has been strong.

Despite these uncertainties the mood of confidence is growing within boardrooms and momentum for dealmaking is building. Of course, in the current environment we are seeing our clients highly focused on achieving and demonstrating stakeholder value and they remain relatively risk averse, with compliance and reputational issues high on the agenda in any transaction.

Matthew Layton

Global Head of Corporate, Clifford Chance LLP