A weak global economy, China, the prospect of further US interest rate rises in 2016, the UK’s “Brexit” vote and the outcome of the US presidential election are all combining to divide dealmakers’ opinions on the biggest threats to merger and acquisition (M&A) activity over the next six months, according to insights from Intralinks.
The survey was done between October 4 and 11, 2016 covering the Asia Pacific, Europe, the Middle East and Africa, North America and Latin America regions.
Respondents from Asia Pacific (APAC) predict that the economic and market events in China will have the most impact on M&A activity in the region over the next six months.
In North America (NA), dealmakers predict the US presidential election will have the most impact over the same period, despite the other significant economic factors in play such as further interest rate rises.
In Europe, the Middle East and Africa (EMEA), respondents believe Brexit will have the most impact in the next six months and in Latin America (LATAM) monetary policy tops dealmakers’ concerns.
“There’s clearly an overwhelming consensus among dealmakers that Hillary Clinton will be the next US president and that Donald Trump would be bad for global M&A,” said Philip Whitchelo, VP Strategy & Product Marketing at Intralinks. “However, factors other than US politics are also dominating dealmakers’ attentions, with the UK’s Brexit vote, monetary policy changes and the impact of China on the global economy being top of mind for many,” he added.
The APAC results of the survey showed that 51% of respondents expect to participate in more deals in the next 6 months than the previous 6 months.
Eighty-six percent of respondents think Hillary Clinton will win the US Presidential Election. Fifty-nine percent of respondents believe the impact of a Trump presidency on the M&A market in their region would be negative; and 66% of respondents believe a Clinton presidency would have no impact on the M&A market in their region [28% positive, 6% negative].
The industry with the most M&A activity will be Industrials.
At a global level, while 56 percent of respondents believe that a Trump presidency would have a negative impact on M&A activity, only 15 percent believe that he will actually win. Conversely, 57 percent of respondents globally believe a Clinton presidency would have no impact on M&A activity, with 26 percent of dealmakers stating a Clinton presidency would have a positive impact on M&A activity.