Ohio Dealmakers Optimistic About M&A

May 6, 2010 6:40 a.m.CLEVELAND -- After 18 months of pervasive gloom, dealmakers from Ohio are increasingly more positive about the mergers and acquisitions environment, according to the latest DealMakers Survey by the Association for Corporate Growth and Thomson Reuters. While the last three surveys were consistently dreary, 94% of Ohio dealmakers now expect an increase in mergers and acquisition activity in the next six months.“We’ve seen an increase in the quality of the deals in 2010 as compared to last year,” said Thomas Littman, president and senior managing partner of middle-market private equity firm Kirtland Capital Partners. “While we’re not back to the crazy days of 2007 to 2008, we are bullish on the outlook for the M&A market for the rest of 2010.”The survey polled investment bankers, private equity professionals, corporate development officers, lawyers, accountants and business consultants. Respondents expect the most merger activity in the manufacturing and distribution sector (cited by 33%), followed by health care/life sciences (18%), technology (15%) and consumer products and services (9%).“Many factors are contributing to the increased M&A activity, including the greater willingness of business owners to consider a sale because their businesses have stabilized, significant improvement in the debt markets over the last six months and the potential change in the capital gains tax rate in 2011,” Littman noted.Fully 82% of respondents identified the current environment as a buyer’s market, and 94% expect strategic investments to accelerate in 2010. The greatest drag on M&A activity today is the number of sellers unwilling to sell at multiples offered, according to 46% of dealmakers. This is followed by the credit crunch (20%).According to Thomson Reuters, the volume of all worldwide mergers and acquisitions totaled $573.3 billion during the first quarter of 2010, a 21% increase over the first quarter of 2009.
Published by The Business Journal, Youngstown, Ohio