Appetite from both sides will see deal volumes continue to rise through 2013
2012 has seen M&A activity move significantly towards pre-recession levels. The continuing access to capital and finance on the buy side, coupled with stronger balance sheets and soaring appetite for divestiture has meant that deal completions have reached record levels here at Benchmark International. With corporate confidence improving further in addition to the huge levels of cash available to investors under pressure to spend, 2013 looks set to prove even more successful in terms of deals completed.
Commenting on Benchmark International’s deal activity through 2012 and looking forward to 2013, CEO Greg Jackson commented, “We have worked on behalf or sellers and buyers from a broad range of industries and sectors. Working within the current economic climate, Benchmark International’s deal leaders have been working around the clock to ensure that maximum value is reached for our clients. With such a strong appetite from both buyers and sellers coupled with all the hard work we have put in, 2012 has proved a record year for us in terms of deals converted.”
“Corporate cash levels remain in a steady position, indicating a continued opportunity for companies to invest their available capital in M&A activity as an avenue for growth. Couple this with large sums of cash available to private equity and an increasing pressure to invest, 2013 looks like continuing the trend of deal successes.”
Divesture levels reached their highest level since 2005 in 2012 and look certain to remain a key driver for deal making going into 2013 as companies seek to unlock value in assets. Successful divestitures in today’s market require a strong focus on future potential and opportunities for development and growth. An accurate portrayal of long-term potential value helps ensure that sellers reach maximum value for their company.
With private equity deals accounting for 18% of total deal value in 2012 it seems that whilst corporates continue to drive deal activity, private equity involvement in the market remains very active. With roughly $1trillion dry power waiting to be deployed, private equity seemingly looks like it will provide high levels of deal activity once more in 2013, with an increase on 2012’s figures a strong possibility.
Looking into 2013, all the factors at play which served to make 2012 a record year at Benchmark International seemingly look set to continue, if not increase in their prominence. These factors, including strong appetite from the buy side and high levels of unspent cash available to corporate and private equity buyers look set to place sellers in a perfect position to achieve maximum value for their companies.
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