New York, NY, April 28, 2016 — The Intralinks Deal Flow Predictor (DFP), an indicator of future mergers and acquisitions (M&A) announcements with a proven track record for accuracy, forecasts no growth in the total number of M&A deals to be announced globally through the first nine months of 2016 compared to the same period in 2015. Compared to last quarter, we’re seeing an overall slowdown in early-stage M&A activity, and there is a possibility that the full year 2016 will see an overall global M&A decline compared to 2015. While the global headline figure appears to indicate a stalling of dealmaking activity, there is a remarkable division when looking at the four global regions. In two regions – Asia Pacific (APAC) and Europe, the Middle East & Africa (EMEA) – early-stage M&A activity grew by nearly 10 percent and 8 percent in Q1 2016, respectively, whereas in Latin America (LATAM) and North America (NA) it declined by 8 percent and 9 percent, respectively.
“We’re starting to see a slowdown in M&A activity in NA and LATAM amid growing uncertainty over the state of the global economy and continued weakness in commodity and oil prices,” said Matt Porzio, Vice President of M&A Strategy and Product Marketing at Intralinks. “Nevertheless, corporate executives are facing challenges in finding ways to grow in a weak economy with low inflation, and the pressure to continue to do deals could outweigh nervousness. Based on our insights into early-stage M&A activity, we are predicting a flat first nine months in terms of deal announcements globally compared to last year, with NA and LATAM declining due to reduced business confidence, falling corporate profits and the commodities slump. Meanwhile, APAC will continue to grow, as dealmakers target acquisitions to benefit from the region’s fast-growing economies and growing middle class. This may be surprising due to moderation in Chinese growth, and recovering European economies and quantitative easing measures by the European Central Bank (ECB) continuing to support strong levels of M&A activity in Europe.”
The Intralinks DFP forecasts the volume of future M&A deal announcements by tracking the number of early-stage M&A deals that are in preparation or have reached the due diligence stage. On average, these deals are six months away from their public announcement. The Intralinks DFP has been independently verified as an accurate predictor of the number of future M&A deal announcements.
The Intralinks DFP’s findings are consistent with the responses to Intralinks’ latest quarterly Global M&A Sentiment Survey, which polled M&A dealmakers in April 2016 and involved responses from 1,500 M&A professionals. The survey’s findings included the following:
- 45% of respondents in APAC expect to participate in more deals over the next six months than the previous six months, a decline from 56% in the previous survey in December 2015
- 51% of respondents in EMEA expect to participate in more deals over the next six months than the previous six months, a slight increase from 50% in the previous survey in December 2015
- 49% of respondents in LATAM expect to participate in more deals over the next six months than the previous six months, a decline from 57% in the previous survey in December 2015
- 45% of respondents in NA expect to participate in more deals over the next six months than the previous six months, a decline from 49% in the previous survey in December 2015
- Dealmakers in APAC, EMEA and NA are most concerned about a global economic slowdown having an impact on M&A activity in their region over the next six months, whereas dealmakers in LATAM expect commodity and energy prices and monetary policy to have the most significant impact on M&A activity in their region over the next six months
- In NA, 46% of respondents believe that, if elected, Donald Trump will have a negative impact on M&A activity in their region
- In EMEA, 87% of respondents believe that a vote by the UK to leave the EU will have an impact on M&A activity in the UK and/or Europe, and of those 83% think it will have a negative impact
Download the complete Intralinks DFP report.
About the Intralinks Deal Flow Predictor
The Intralinks Deal Flow Predictor provides Intralinks' perspective on the level of M&A due diligence activity taking place during any given period of time. The statistics contained in the Intralinks DFP represent the volume of VDRs opened, or proposed to be opened, through Intralinks or other providers for the purpose of conducting due diligence on proposed transactions including asset sales, divestitures, private placements, financings, capital raises, joint ventures and partnerships. These statistics are not adjusted for changes in Intralinks' share of the VDR market or changes in market demand for VDR services. These statistics may not correlate to the volume of completed transactions that may be reported by market data providers and should not be construed to represent the volume of transactions that will ultimately be consummated during any period of time. Indications of future completed deal activity derived from the Intralinks DFP are based on assumed rates of deals going from due diligence stage to completion. In addition, the statistics reported by market data providers may be compiled with a different set of transaction types than those set forth above.
THIS PRESS RELEASE AND THE INTRALINKS DFP (COLLECTIVELY THE "MATERIALS") ARE PROVIDED "AS IS" FOR INFORMATIONAL PURPOSES ONLY. INTRALINKS MAKES NO GUARANTEE, REPRESENTATION OR WARRANTY OF ANY KIND REGARDING THE TIMELINESS, ACCURACY OR COMPLETENESS OF THE CONTENT OF THE MATERIALS. THESE MATERIALS ARE BASED ON INTRALINKS' OBSERVATIONS AND SUBJECTIVE INTERPRETATIONS OF DUE DILIGENCE ACTIVITY TAKING PLACE, OR PROPOSED TO TAKE PLACE, ON INTRALINKS' OR OTHER PROVIDERS' VDR PLATFORMS FOR A LIMITED SET OF TRANSACTION TYPES. THESE MATERIALS ARE NOT INTENDED TO BE AN INDICATOR OF INTRALINKS' BUSINESS PERFORMANCE OR OPERATING RESULTS FOR ANY PRIOR, CURRENT OR FUTURE PERIOD, NOR ARE THESE MATERIALS INTENDED TO PROMISE, GUARANTEE OR ASSURE FUTURE LEVELS OF COMPLETED DEAL ACTIVITY. THESE MATERIALS ARE NOT INTENDED TO CONVEY INVESTMENT ADVICE OR SOLICIT INVESTMENTS OF ANY KIND WHATSOEVER.
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