Welcome to the first BDO HORIZONS of 2017, in which our M&A professionals review the past year and analyse what lies ahead.
At our annual BDO Corporate Finance conference in Copenhagen last November, we were able to discuss face-to-face the most significant M&A developments of 2016 across where BDO operates. In this issue we share the results and look ahead to 2017. And how is the new year shaping up?
In 2016, political decisions were at the fore. In June 2016 came the Brexit decision, while December saw the resignation of Italian Prime Minister Matteo Renzi, cash chaos in India and, of course, the election of Donald Trump in the US. We consider how these events all impacted economies, markets and M&A activity.
Looking ahead to 2017, economic factors, like the interest rate decisions of the American national bank and the European central bank, will of course influence markets. But politics will continue to play a leading part, with elections in March in the Netherlands, in April/May in France, in May in Iran, in October in Germany and in October/November in China.
INSIGHTS FROM A LEADING M&A ADVISER
Looking at 2016 as a whole, M&A activity fell below 2015 levels. Deal numbers dropped by 10%, while volume fell 6.7%. Our analysis focuses on deals valued from USD 5m to USD 500m.
On a quarterly basis, however, we can see that Q4 2016 saw slightly better deal value and volume than Q3 2016, but could not top the success of Q4 2015.
With the current political and economic challenges ahead, M&A professionals are confronted with new questions. Will 2017 be the turning point for the M&A market? Or has weakness in the global economy yet to bottom out?
We examine these and many other questions in this edition of BDO HORIZONS. Then, through our Looking Ahead commentary and BDO Heat Charts, we identify trends for the upcoming quarter.