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Credit Crunch And A Slowing Economy Crimp Worldwide Buyout Activity, Putting Strategic Buyers In Control by ProQuest

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Worldwide announced mergers and acquisitions (M&A) in the first three quarters of 2008 declined by 25% from the same period a year earlier, according to Thomson Reuters, reflecting the effects of the credit crunch and a slowing global economy. The decline would have been considerably larger had it not been for a wave of mergers in the troubled financial services industry itself. The private equity industry is restructuring and adapting to a changed situation in which financing is harder to obtain. M&A activity is shifting to the middle market as a result of the credit crunch and worsening economy. The credit crunch and reeling financial markets were also blamed for the failure of a number of proposed deals to be completed. On a regional basis, M&A activity in Europe declined 29% from the same period a year earlier in the first nine months of 2008, while deals in the US declined 27% and deals in Japan fell 38%.

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