2013 M&A Surge Seen if Fiscal M&A Resolved —CBS Marketwatch

Deal Activity Will Likely See a Surge in 2013 if a Meaningful Deficit-Reduction Compromise Can Be Reached 

Wallace Witkowski at Marketwatch reported in mid-December that deal activity will likely see a surge in 2013 if a meaningful deficit-reduction compromise can be reached.  Otherwise the market will remain stunted as it was in the past year.   Democrats and Republicans didn’t come to a full agreement by year end, or even early January, but the fact that it’s still possible within weeks and months allows his prediction to stand:  

Much of 2012’s downturn was the result of widespread uncertainty over what tax and spending rates will be in 2013. Unless President Barack Obama and House Republicans reach a compromise by the end of the year, the fiscal cliff of automatic tax hikes and spending cuts kicks in.

Mergers and acquisitions activity in 2012 reached a ten-year low, with the number of deals down 10% to 6,357 from the 7,077 recorded in 2011, and the value of those deals down 26% to $625.7 billion from $846.9 billion, according to Thomson Reuters figures from late November.

. . . Middle-market deal strength expected to continue:  Many of the deals rushing to close by the end of the year are in the $100 million to $1.5 billion range, according to Bob Baltimore, managing director at middle-market investment bank Harris Williams.  “We’re going to close a record number of transactions, and our pipeline activity is pretty strong,” Baltimore said.

There’s a Strong M&A Pipeline if Washington Reaches a Fiscal Deal