Pace of Strategic M&A and LBOs to Continue, Claims Market Makers Survey of M&A, Private Equity and Corporate Executives
New York, May 16, 2007 – mergermarket, the M&A intelligence and research service, is pleased to announce the findings of its annual Market Makers survey. The study, published in conjunction with Fried, Frank, Harris, Shriver & Jacobson LLP, is the result of 150 interviews with prominent private equity professionals, M&A bankers, and corporate CEOs in both the US and Europe, designed to gauge expectations and opinions on the leading issues facing the M&A and private equity industries.
The survey yielded several surprising findings. While the availability of cheap debt is regularly cited as a contributing factor in the ongoing private equity boom, only 3% of respondents consider such availability a "principle driver" of mega-buyouts. Other trends, such as the popularity of consortium bids and the opportunity for superior returns compared to smaller companies, were considered more influential drivers. Respondents thus are likely to expect continued mega-buyout activity regardless of any turn in the credit cycle.
Furthermore, respondents clearly favor secondary buyouts as the exit strategy of choice for today's LBOs, contrasting with the popular notion that a strategic sale or IPO exit signals a "successful" buyout.
Additional findings from the survey include the following:
The report, available at www.friedfrank.com, also includes feature articles on the continued momentum of strategic M&A; the drivers behind the current LBO boom; and the development of mega-funds in private equity.