Although the era of the mega-deal is on hold, merger and acquisition activity in 2008 will continue, dominated by corporate and foreign buyers and the middle market, according to PricewaterhouseCoopers’ transaction services group.

Bob Filek, a partner in PricewaterhouseCoopers’ transaction services group, said the era of public-to-private transactions was on hold for now, but the downturn in mega deals by private equity would be offset by an increase in international buyers coming into the US to take advantage of a continued weaker dollar.

‘We also believe that more traditional private equity transactions will build momentum as 2008 progresses,’ he said. ‘We expect financial markets to quickly respond to put liquidity back into more balanced leverage lending.’

Provided rates of troubled commercial bank loans held steady and the ‘credit overhang work its way down’, Filek predicted savvy corporate buyers and a few nimble private equity funds would take advantage of a lull in M&A activity to lock down transactions.

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