Wednesday, January 19, 2011

Dealmaker Confidence High as M&A Starts Off New Year with a Bang

Posted by Tom Huddleston Jr., The AmLaw Daily, January 19, 2011:
Shortly after the champagne corks stopped popping, the M&A market started to take off, with a blast of new large deals announced globally.
The Financial Times reported on Monday that, during the first ten days of 2011, combined deal volume totaled $83 billion, up from $67 billion last year. Deal lawyers see this as an example of rising confidence among companies representing a wide array of industry sectors, as well as a reflection of a surplus of cash on the balance sheet.
"[Everyone] looks and says that the improved financing markets and the large accumulation of cash by the large strategics is certainly a factor," says Allison Schneirov, an M&A partner at Skadden, Arps, Slate, Meagher & Flom.
U.S. companies are reported to have roughly $1 trillion in cash on their balance sheets; many are expected to face shareholder pressure to put that cash to use. All that, say deals lawyers and analysts, adds up to what could be the biggest year for M&A since 2007.
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