Report: M&A market returns to a less exuberant one in 2016
With $365 billion in public and private transactions, 2015 saw the highest dollar value of deals in these sectors since 2008.
A new report by Chicago-based A.T. Kearney predicts that while deal volumes for large, more established businesses will stay at 2015 levels, valuations and liquidity that drove the “frothy” seller’s market in 2015 are giving way to a more balanced market. With $365 billion in public and private transactions, 2015 saw the highest dollar value of deals in these sectors since 2008.
The report, “Has the M&A market lost its froth?,”also predicts that 2016 will be characterized by tighter credit markets and lower valuations, especially for smaller companies with riskier, more volatile cash flows. The mergers and acquisitions (M&A) market in consumer-retail overall will be active, but will also return to a more rational market with better balance between buyers and sellers and more reasonable deal values for higher-risk acquisitions.