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IMAP's Global Transaction and Pricing Survey Recaps 2010 M&A Activity and Provides Outlook for 2011


February 22, 2011 - Sarasota, FL

IMAP, an exclusive global organization of leading merger and acquisition advisory firms, announced today the results of its 2010 Transaction and Pricing Survey, which includes M&A transaction data from its 500 advisors at 45 offices in nearly 30 countries. In 2010, IMAP completed 184 transactions with a total value of $11.1 billion. This represents a 77 percent increase from 2009's total transaction value of $6.2 billion from 179 deals. In addition, 33 percent of IMAP's 2010 transactions were cross-border deals.

"2010 proved to be a step in the right direction for global M&A activity as evidenced by the increase in our average deal size," said Sevket Basev, Chairman of IMAP. "Although the number of deals completed did not increase significantly, our average transaction value was $59.8 million, which represents a 73 percent increase from a recent high of $51.7 million in 2008. We see this as a positive indicator that M&A transaction activity is slowly recovering to pre-crisis levels."

Among other indicators, IMAP transaction multiples (EBIT -- earnings before interest and taxes) were above 7.0x for all four quarters of 2010 and edged the range of 8x in the fourth quarter, compared to 2009 where multiples were under 7.0x for the last half of the year.

Other notable results from 2010 included:

  • By sector, industrials had the most closed transactions: 41, followed by high technology with 23 and consumer products and services with 18.
  • M&A activity varied by region. IMAP advisors in North America report that healthcare was the most active sector in 2010, while consumer products and services, and retail were often cited as the most active sector by advisors in Latin America; industrials was number one in Europe; and consumer products and services was number one in Asia.
  • Real estate-sector transactions saw the highest multiples on average at 9.7x EBIT, followed by healthcare with 9.4x EBIT and materials at 9.2x EBIT. IMAP advisors report that the time it took to close transactions was significantly less in 2010 than in 2009: 32.3 weeks in 2010 versus 36.2 weeks in 2009 -- a full month less.
  • The majority of IMAP advisors report that access to bank financing was easier in 2010. This is a reversal of last year when 84 percent of advisors said bank financing had become more difficult to obtain in 2009 compared to 2008.
  • The advisors also report that they witnessed an increase in both the number of sellers and buyers in the market. Last year, 73 percent of IMAP advisors reported that there were fewer sellers in 2009 than in 2008. In 2010, there was a reversal of this trend, more than 60 percent of the advisors reported that there were more sellers in 2010 compared to 2009 and 75 percent observed more buyers.

Key predictions for 2011 from IMAP advisors include:

  • 2011 will be a year of consolidation in China. Chinese firms will also be active in cross-border transactions.
  • Brazil will continue to be a hot market for global M&A as multinational companies continue to expand business in the country.
  • Currency fluctuations may create more international acquisition opportunities.
  • Lenders will be more flexible in accommodating cash flow loans needed to fund business acquisitions.
  • Buyers will become more realistic about valuations and deal structures.

To view or download the complete IMAP Global Transaction and Pricing Survey, please visit: http://www.imap.com/imap/media/article_documents/2010TransctnPricing_LoRes_A56BE87069745.pdf

Media, private equity groups, corporate development personnel, global M&A attorneys and other industry professionals will have an opportunity to meet representatives from IMAP at IMAP's 2011 Global Mergers & Acquisitions Symposium in New York, N.Y. on Thursday, March 31. Registration is now open and additional information on this spring symposium is available on the IMAP Web site: www.imap.com/conferences.

About IMAP
IMAP is an exclusive global organization of leading merger and acquisition advisory firms. Formed in 1973, IMAP is composed of 45 offices in nearly 30 countries throughout North and South America, Eastern and Western Europe and Asia. In 2010, IMAP advisers completed 184 transactions, with an aggregate transaction value of more than $11.1 billion. IMAP advisers provide strategic merger, acquisition, divestiture and related corporate finance services. Sellers of mid-size companies and corporate acquirers alike rely upon IMAP for essential local market knowledge and industry expertise delivered with unparalleled global reach. Every business day, somewhere in the world, an IMAP adviser is completing an M&A transaction. More information is available via the Internet at www.imap.com.

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To obtain a copy of IMAP's Global Transaction and Pricing Survey, or if you are interested in receiving expert commentary from a member of IMAP's global network of advisors, please contact the following:

Media Contacts:
Christina Bereta for IMAP
(312) 780-7218
cbereta@dresnerco.com

Caitlin Carr for IMAP
(312) 780-7220
ccarr@dresnerco.com

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