Global Industrial Manufacturing M&A measured similar lengths between 2017 and 2016 excluding the megadeal between JCI/Tyco in 2016. 2017 showed us a more predictable and steady deals market as deal makers pushed through turbulence and uncertainty as they assessed assets around the globe. Deal volume was healthy with roughly 2,500 announced deals in both years which was ~100 deals higher than FY 2015.
Cross-sector global deal value remained flat at $3.6 trillion while volume increased slightly by 2.5%. Although US cross-sector deal value plummeted 16%, deal volume increased 14% reflecting the softness of the middle market deal space. The Industrial Manufacturing sector did not show that same level of activity with flat value and volume.
Deal makers should be optimistic about where the deals environment is headed. Many of the headwinds seen in the last half of 2016 and 2017 have subsided. GDP is expected to expand globally to 3.7%, cost of borrowing remains low, and stock market highs are fueling record shareholder returns. Above all, US tax reform has provided the perfect catalyst for increasing M&A activity domestically as well as making the US a more attractive market for other dominant global players, including Europe and China.
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