Signs of mid-market M&A recovery in 2010

The drop-off in merger activity last year was much worse than expected, but corporate finance advisers still feel there are reasons to be optimistic about mid-market deals in 2010.

Figures from Grant Thornton showed that in 2009, the number of mergers and acquisitions involving all British targets fell nearly a quarter to 2,086, the lowest since 1994. The total value of deals announced in Britain dropped by a third to £97.6bn.

"M&A activity in 2009 turned out to be worse than the corporate finance fraternity had anticipated, but in the UK we see grounds to be cautiously optimistic about mid-market M&A for 2010," said David Brooks, head of M &A at Grant Thornton.

"Aside from distressed M&A, there are a growing number of private company sales driven by a rising level of interest from acquisitive corporates and a somewhat improved funding environment."