Global M&As dip 19% to $1.4 trillion in Jan-Sept

The value of global mergers and acquisitions fell 19.4 per cent in the first nine months of this year to $1.4 trillion, a report says.

In the first three quarters of 2012 the global M&As added up to $1,426.5 billion, down by 19.4 per cent on the same period in 2011, when $1,769.3 billion worth of deals were announced, advisory firm mergermarket said.

Meanwhile, in the July-September quarter, BRIC (Brazil, Russia, India and China) nations witnessed lowest total since the first quarter of 2009, it added.

The downward trend was witnessed in the Asia Pacific region during the first three quarters of 2012, as it witnessed 14.8 per cent dip in M&A deals, adding up to $241.8 billion, from the comparable period a year ago.

However, during the third quarter, Asia-Pacific was the only region that saw an increase in deal activity. In Q3, the region saw 20.8 per cent rise in M&A deals from the previous quarter, mergermarket said.

A region-wise analysis shows that in the first nine months of this year, the US M&A total was $483.6 billion, down 23.1 per cent, over the same period in 2011.

There was also a drastic decline in European deals in Q3 2012 with a total value of $99.2 billion —— down 46.1 per cent from Q2 2012, when transactions worth $183.9 billion were announced. It was a dip of 40 per cent over Q3 2011 ($165.2 billion).

According to market experts, the overall M&A landscape is witnessing moderation in the deal momentum due to the global economic concerns (mainly around Europe).

Deals in the ‘energy, mining and utilities’ sector have contributed the lion’s share of overall deal value so far this year, accounting for 26.6 per cent of total global deal value in Q1-Q3, more than the next two sectors combined.

“The sector contributes four of the 10 largest deals announced since the beginning of 2012,” mergermarket said.

Meanwhile, emerging markets’ total for first three quarters of 2012 stood at $293.5 billion, 24.1 per cent less than the previous year.

According to mergermarket, BRIC countries saw the lowest quarterly total since the first quarter of 2009.

Emerging Markets accounted for 15.8 per cent of global M&A activity in Q3 2012, down from the 23.5 per cent they accounted for in the same period in 2011.

During the first nine months of this year, European bidders remained the most active investors into emerging markets with $47 billion-worth of deals.

This was down 33.4 per cent compared to the same period last year, when $70.6 billion worth of deals were announced.

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