KPMG predicts surge in M&A activity

Mergers and acquisitions in 2007 could reach the record levels of 2000 if
companies take advantage of a window of opportunity and ‘execute strategic
deals’, according to KPMG’s Global M&A Predictor.

The firm said ‘intelligent deals’ done by corporates could ‘break the recent
siege laid to the world’s M&A markets by private equity houses and hedge

KPMG quoted data from Dealogic, which revealed that deal numbers are up on
the previous six months. 

The firm predicted, given current benign debt market conditions combined with
sound corporate balance sheets, further increases in activity ‘albeit at a
slower rate’

It is anticipated that M&A activity could then plateau in 2007.

Stephen Barrett, international chairman of KPMG’s corporate finance practice,
said that ‘despite early signs that the pace of global M&A activity is close
to peaking, KPMG’s Global M&A Predictor suggests that there is still
considerable scope for corporates to forge intelligent deals’.

‘Corporate confidence is high, balance sheets are strong and, given the
astute management of the corporate sector, there is plenty of room for
corporates to drive further growth in profits from revenue and cost synergies.
In addition, macro-economic conditions are favourable,’ he added.

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