Private-equity firms have featured prominently in the years M&A deals

Private-equity firms have featured prominently in the year's M&A deals

The number of M&A deals concluded by consumer products companies exceeding 300 in the third quarter, the first time since before the recession, data from Ernst & Young has shown.

According to the research, the number of deals globally totalled 301 in the third quarter of 2010, the first time deals volumes have exceeded 300 since the second quarter of 2008.

The value of the deals more than doubled on the level seen in the second quarter of this year to US$22.5bn, although it was some way off the peaks seen in the first quarter of this year when $43.22bn of M&A was signed. In the second quarter of 2008, the value of mergers and acquisitions stood at $89bn.

Private equity accounted for over 20% of the total number of deals in the third quarter, Ernst & Young said, the highest proportion since the first quarter of 2007. According to Ernst & Young, private equity was active both as a buyer and a seller, appearing as a buyer in two of the top five deals and as a seller in three of the top ten deals.

The firm attributed the shift to a "gradual thawing of capital markets" which has allowed private-equity firms secure debt funding for high-quality mid-size transactions.

However, Ernst & Young said there will still be "bumps in the road ahead" with the economic outlook remaining far from certain, with policymakers "nervously eyeing economies they hope will be strong enough to withstand far-reaching public-debt-reduction programmes".

"This uncertainty may keep companies more focused on doing bolt-on deals, rather than betting the house on a mega-deal, but we believe they will not be deterred from making acquisitions." said David Murray, global consumer products transactions leader at Ernst & Young. "Indeed, the prospect of prolonged low growth in Western countries strengthens the rationale for deals that give access to the faster growth of emerging markets, or which bolster market position in developed economies.