The sharp decline in M&A activity witnessed with the onset of the recession in the UK is showing some signs of abating, a leading M&A advisory firm has suggested.
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However, while the pace of M&A activity has picked up deals are still largely being driven by insolvencies, meaning that activity remains down in value terms, advisory firm Oghma Partners said in its second tertial update.
Insolvencies have driven 25% of transactions in the year-to-date, versus only 5% in the comparable period of last year.
Year-to-date deal value is estimated at GBP660m, compared to GBP2bn for the whole of 2008.
While second tertial deal level is marginally up over last year, Qghma Partners said there is little chance of an increased level of M&A activity this year.
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By GlobalData“Given transaction lead times, it is unlikely that any positive sentiment, detectable in the economy and a rebounding equity market, will lead to increased M&A activity until end 2009 or the first half of 2010.”
