The total number of M&A deals to be announced globally in FY 2016 is expected to increase by less than one percent compared to FY 2015, according to the Intralinks Deal Flow Predictor, an indicator of future mergers and acquisitions (M&A) announcements.
In addition, year-over-year (YoY) growth in early-stage M&A activity in Q2 2016, which is an indicator of M&A announcements in Q4 2016, shows significant regional variations. In Asia-Pacific (APAC), early-stage M&A activity declined very slightly by 0.4 percent. In North America (NA), early-stage M&A activity declined by 11 percent.
In Europe, the Middle East and Africa (EMEA) and Latin America (LATAM), early-stage M&A activity grew by nearly 16 percent and 11 percent, respectively.
“The slowdown in early-stage M&A activity that we have seen in the first half of 2016 has been driven primarily by lower levels of activity in NA, where a slowdown in economic growth, the prospect of further US Federal interest rate rises in 2016 and uncertainty over the outcome of the US Presidential election in November are combining to cause dealmakers to pause for breath,” says Matt Porzio, Vice President of M&A Strategy and Product Marketing at Intralinks.
“EMEA is showing stronger levels of growth, and even LATAM has staged a recovery despite a continued slump in Brazil.”
The Intralinks Deal Flow Predictor forecasts the volume of future M&A deal announcements by tracking early-stage M&A activity – sell side M&A transactions across the world that are in preparation or have reached the due diligence stage.
These early-stage deals are, on average, six months away from their public announcement. The Intralinks Deal Flow Predictor has been independently verified as an accurate predictor of future changes in the global number of announced M&A transactions, as reported by Thomson Reuters.