Publications - 08.07.2010 - 00:00 

Roller-coaster ride in M&A market

Roche takes over Genentech, Tamedia weds Edipresse: the Swiss market for mergers and acquisitions (M&A) is also in motion in times of economic crisis.

23 March 2009. The M&A REVIEW published by the Institute of Management (IfB-HSG) at the University of St.Gallen describes the development of the Swiss M&A market in 2008 as a “roller-coaster ride”: the promising start in the first quarter was followed by a steep drop by the fall.

Swiss transaction market quite stable
The global financial crisis caused many deals to stagnate or be given up. In comparison with other European countries, however, the Swiss transaction market proved quite stable. By way of an annual review, the editors of M&A REVIEW analyzed the data contained in the M&A DATABASE, which records all transactions conducted in the German-speaking area since 1985.

Sever factors responsible
The editors of M&A REVIEW consider several factors to be responsible for the decrease in transaction activity in Switzerland: “Entrepreneurs are uncertain about the development of the various industries. This deters them from carrying out acquisitions.” The authors reckon that reliable forecasts will be almost impossible in the coming months, and it will be difficult to borrow capital to finance acquisitions.

Many financial investors such as private-equity funds now only rarely find potential purchases at attractive conditions. However, the high number of transactions with international players might well prove to be a favorable influence on the development of the Swiss M&A market in 2009: all in all, almost two thirds of the 482 transactions recorded were cross-border deals.

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