There may be some signs of green shoots in the markets, but dealmakers do not necessarily believe the bull is back when it comes to their corner of Wall Street, according to a new survey.
The latest twice-yearly survey by the Association for Corporate Growth and Thomson Reuters announced Tuesday at ACG InterGrowth, Wynn Las Vegas reveals the most negative outlook in the five-year history of the survey, with 88% of dealmakers saying the current M&A environment is fair or poor, compared to 86% in December 2008. ACG calls the 88% figure "close to unanimous" as to the current state of the M&A market.
Believe it or not, there is a bright side. The view is more or less stagnant over the last five months, and it could even be construed as the bottom when considering respondents' views toward the future.
More than half of the 703 respondents anticipate dealmaking will improve in the second half of 2009, led by distressed sales and by mergers in healthcare and life sciences, manufacturing and distribution, and financial services. In fact only 10% of the investment bankers, private equity professionals, corporate development officers, lawyers, accountants and business consultants polled expect dealmaking to slow further, and 34% expect it to remain the same.
The leading cause of the pessimism is the credit crunch, as the survey also revealed back in December. However, dealmakers who blame the credit crunch for a lack of mergers fell to 33% from 43% in December, followed by sellers unwilling to sell at multiples offered (27% today versus 22% in December) and weak economy (17% today versus 16% in December).
See two full summations of the study below and see TheDeal.com's Corporate Dealmaker for stories from ACG InterGrowth. - Matthew Wurtzel
There may be some signs of green shoots in the markets, but dealmakers do not necessarily believe the bull is back when it comes to their corner of Wall Street, according to a new survey.
