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Will 2008 be another robust year for U.S. middle-market deals? It really depends upon who you ask because a survey by CFO Research Services and CIT Group Inc. shows enthusiasm amongst executives for midmarket dealmaking. However, the numbers don't lie, and in the first month of the year midmarket deals declined, according to statistics from Robert W. Baird & Co.'s Merger Monthly newsletter.
The number of middle-market deals declined 31.5% in January 2008 compared to the same year-ago period. There were 241 middle-market deals with a total valuation of $26.6 billion in the first month of 2008 versus 353 transactions valued at $36.3 billion in January 2007. The tightening of the credit markets as well as fears of a recession might be blamed for the downturn. But don't tell that to senior management of midmarket companies who in the recent survey by CFO Research and CIT Group feel midmarket deals will heat up. A slew of recent middle-market deals might be a testament to the survey's outlook. Just this week, Newell Rubbermaid Inc. acquired Technical Concepts Holdings LLC, a maker of touch-free public restroom equipment for $445 million; Novell Inc. purchased PlateSpin Ltd. for $205 million in cash; and KRG Capital Partners LLC bought two companies that provide engineering and project management services to the oil and gas industry for $450 million. - Gerald Magpily
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