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http://www.bloomberg.com/news/2012-03-29/global-takeovers-drop-in-quarter-as-bankers-see-reversal.html
An aerial view shows the Super Pit and mining operations at Xstrata's Mt. Isa mine. Glencore's $45 billion deal for Xstrata was the only announced purchase in the quarter that topped $8 billion.
Global dealmaking slumped for a third straight quarter as chief executive officers funneled cash into share buybacks and new products, a trend that may reverse in the coming months as the economic recovery gains momentum.
Mergers and acquisitions so far this quarter fell 14 percent from the fourth quarter to $418 billion, making it the slowest three-month period in 2 1/2 years, according to data compiled by Bloomberg. Glencore International Plc’s (GLEN) $45 billion deal for Xstrata Plc (XTA) was the only announced purchase in the quarter that topped $8 billion.
Most CEOs are only now beginning to consider deals, said investment bankers at Goldman Sachs Group Inc. (GS) and Citigroup Inc. (C), predicting renewed confidence in the U.S. and Europe will spur a pickup. Since deal negotiations often take three months or more, the first quarter is mainly a reflection of a temporary slowdown that began last year as global stock markets hit a one- year low, bankers said.
“I still think big cash surpluses will lead to more M&A because companies fundamentally want to grow,” said Peter Tague, who started as co-head of global M&A at Citigroup in New York in this month. “If we find ourselves in June having these same low activity levels, I’d be really surprised.”
An aerial view shows the Super Pit and mining operations at Xstrata's Mt. Isa mine. Glencore's $45 billion deal for Xstrata was the only announced purchase in the quarter that topped $8 billion.
Global dealmaking slumped for a third straight quarter as chief executive officers funneled cash into share buybacks and new products, a trend that may reverse in the coming months as the economic recovery gains momentum.
Mergers and acquisitions so far this quarter fell 14 percent from the fourth quarter to $418 billion, making it the slowest three-month period in 2 1/2 years, according to data compiled by Bloomberg. Glencore International Plc’s (GLEN) $45 billion deal for Xstrata Plc (XTA) was the only announced purchase in the quarter that topped $8 billion.
Most CEOs are only now beginning to consider deals, said investment bankers at Goldman Sachs Group Inc. (GS) and Citigroup Inc. (C), predicting renewed confidence in the U.S. and Europe will spur a pickup. Since deal negotiations often take three months or more, the first quarter is mainly a reflection of a temporary slowdown that began last year as global stock markets hit a one- year low, bankers said.
“I still think big cash surpluses will lead to more M&A because companies fundamentally want to grow,” said Peter Tague, who started as co-head of global M&A at Citigroup in New York in this month. “If we find ourselves in June having these same low activity levels, I’d be really surprised.”
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