Wednesday, September 23, 2009
Key findings of Nixon Peabody's senior executive M&A survey include:
- Mid-market deals under $250 million are expected to dominate over the next 12 months, with the industrial and financial services segments most likely to generate the highest volume of opportunities.
- While strategic buyers are expected to offer higher premiums than private equity buyers, 61 percent of respondents state that private equity firms’ ability to execute transactions quickly makes them more attractive to target companies.
- Financial sponsors are far more likely than their corporate counterparts to explore distressed deals. Accordingly, 56 percent of private equity respondents who have not traditionally focused on distressed opportunities say they plan to do so this year.
- Over the next 12 months, buyers will be focused on targets that complement existing businesses or operating units while sellers primary objectives will be to raise capital and divest non-core assets.
- 72 percent of respondents expect seller financing to be the most popular form of financing in the absence of regularly available debt.
- 58 percent of respondents expect sellers to negotiate higher termination fees over the next 12 months, and their use of MAC clauses and other deal terms reflects their concerns about transactions closing.
Here's a link to the full 2009 M&A Executive Insight report.