The Canadian mergers and acquisitions (M&A) market reported its lowest activity level since the second quarter of 2009, despite the proposed high-profile merger of the London Stock Exchange Group Plc and the TMX Group Inc. The decline came as a surprise after three quarters of rising activity. The Financial Post reported the following losses and statistics involving the M&A market in this quarter:
- There were only six deals worth more than CDN$1-billion in the first quarter. This is done from nine mega-deals in the last two quarters.
- There were 228 transactions in the first quarter of 2011, down 100 transactions from Q4 2010.
- Transactions from Q1 2011 were only worth CDN$38-billion compared to Q4 2010 transactions that were worth CDN$56-billion.
- Every large deal from the first quarter involved a foreign investor, totalling 80 percent of the total M&A value.
- Activity from financial groups declined in Q1 2011.
- Resources sectors, such as metals, minerals, oil and gas, made up 40 percent of the announced deals.
These numbers are likely to do with the rush to announce deals before 2010 ended. December of 2010 saw a total of 140 transactions whereas January of 2011 only saw 59 transactions.
For more news on the economy, check out the links below:
- Canada’s Trade Deficit
- China Against American Debt-Default Plan
- Recession News: Stronger Growth in Second-Half of Year
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