M&A Deal Activity Reached its highest point Since 2008
According to a report released by BDO, Deal activity with regards to Mergers and acquisitions (M&A) reached its highest standing point since the year 2008 in the last quarter of the year 2016.
As per BDO’s most recent PCPI/PEPI report, which basically tracks the private and trade equity deals, and the report is released on quarterly basis. The report reveals that 771 equity deals took place during the quarter fourth of the year 2016, there has been a 33% increase in number of deals when compared with the total of the quarter 3 which stands at 578 equity deals. The number of equity deals that happened in quarter fourth of the year 2016 was also the highest recorded quarter with regards to equity deals since the quarter two of the year 2008.
The report also revealed that 672 out of the 771 equity deals were executed by the trade buyers, which indicated that companies are hungry for more growth and also highlighted the fact that the companies are not afraid to take on the challenges the brexit poses to the business community.
While the report also showed a slight drop in Private equity deals in the quarter fourth of the year 2016, in which 99 equity deals took place in quarter fourth compared with 106 deals that were completed in the third quarter of the year 2016.
The report also found out that the growth M&A Deal activity has not come at the expense of the values of the equity deals. This is because private (11.3x) and trade equity (10.5x) multiples have been maintained at pretty high levels in the last quarter of the year 2016.
The volume of deals in quarter four basically gives a fitting end with regards to an active year in terms of M&A activity.