Worldwide M&A deals could grow -1% to 6% in Q1 2018: study

THE number of merger and acquisition (M&A) deals announced worldwide is set for a fourth consecutive year of growth in 2017, and could grow by around 2 per cent year-on-year in the first quarter of 2018, a study by Intralinks has found.

For the full year, announced M&A deals are expected to exceed 50,000, setting a record for global deal counts.

Meanwhile, early-stage M&A deals for the third quarter of 2017 rose 5 per cent, maintaining growth from the previous quarter. Based on these data, global provider of M&A deal management solutions, Intralinks, is forecasting that the number of deals in Q1 2018 will increase by around 2 per cent compared to Q1 2017, with a range between negative one per cent and 6 per cent.

"The dealmaking environment continues to be supported by a combination of a gradual pickup in global economic growth, subdued inflation in advanced and emerging economies, buoyant asset markets and historically low interest rates," said Intralink's vice-president of strategy and product marketing, Philip Whitchelo.

Over the next six months, the strongest growth in deal announcements is expected to come from the healthcare, materials and real estate sectors, the study also showed.

Within the Asia Pacific (Apac) region, early-stage M&A activity in Q3 2017 surged 26 per cent from a year ago, while the total number of announced M&A deals for the quarter rose by 12 per cent year-on-year. For Q1 2018, Intralinks is predicting an increase of 14 per cent for total M&A deals in the region.

Across the board, regions in Apac are showing burgeoning early-stage M&A activity, with South-east Asia, India and North Asia (China, Hong Kong and South Korea) leading Apac's growth.

"Despite the political instability on the Korean peninsula and in Myanmar, for most of the Apac region, strengthening global economic demand and supportive fiscal and monetary policy actions are driving vigorous economic growth and increasing dealmaking confidence," Mr Whitchelo said.