A recent survey of mergers and acquisitions advisers by Nexia International, a network of independent accounting and consulting firms including CliftonLarsonAllen, indicates that mid-market deals are active and are expected to increase in the coming year.
Nexia International M&A Survey Reveals Active Deal Market With Anticipated Upswing in Activity
Minneapolis — June 12, 2012 — A recent survey of mergers and acquisitions advisers by Nexia International — a leading worldwide network of independent accounting and consulting firms, including CliftonLarsonAllen LLP — indicates that mid-market deals are active and are expected to increase in the coming year.
According to the Nexia International M&A Snapshot Survey, 40 percent of respondents report that M&A activity has stayed the same over the past year, while 33 percent say it has increased. Looking to the future, 52 percent of survey respondents expect the volume of M&A deals to remain active in the next 12 months, and 36 percent expect deals to increase. Deal value is also expected to remain steady or increase, overall.
“The M&A outlook in the United States is more upbeat than in Europe and the UK,” according to Craig Arends, a partner at CliftonLarsonAllen who helped to prepare the survey report. “M&A activity is expected to hold steady or increase in 2012 due to low interest rates and the record levels of cash held on corporate balance sheets. Debt markets in the U.S. are also generally favorable.”
The Nexia International M&A Snapshot Survey provides an overview of mid-market merger and acquisition activity and some of the key issues affecting deal flow around the world. It is based on responses from the leaders of 66 worldwide Nexia International member firms who reflected on the outlook for mid-market M&A activity in their respective countries. The survey can be downloaded at http://www.nexia.com/assets/publications/SnapShotSurvey.pdf.
According to the firms surveyed, manufacturing is anticipated to be the most active sector for M&A deals in the next 12 months globally, driven by increases in demand from China, India, and other countries. Communications technology and business services will also drive M&A — again in China and India —followed by health care as public health services around the world are increasingly outsourced.
Difficulties in raising financing and a lack of market confidence, followed by an inability to match valuation expectations, may be obstacles to M&A activity, according to the survey. Some players may need to realign their value expectations to new market realties, the survey indicates.
Just over half of the firms surveyed for the Nexia International M&A Snapshot Survey advise privately owned companies, including family businesses. The survey suggests that succession planning remains a critical issue for private companies. Many private owners are faced with a choice between continuing the business through a more challenging economic environment and the prevailing difficulties of raising capital to take the business to the next level or selling the business, even at a lower price.
About Nexia International
Nexia International is a leading worldwide network of independent accounting and consulting firms, providing a comprehensive portfolio of assurance, tax, and advisory services. With more than 570 offices in over 100 countries, Nexia has a substantial presence in the world’s major financial and economic centres. Nexia is strategically placed to serve the diverse international requirements of its clients, ranging from globally listed entities and international subsidiaries, to owner-managed businesses and high-net-worth individuals. Experts from around the Nexia International network work together to provide cohesive, customized services to solve cross-border business issues and advise individuals on wealth creation and preservation. For more information about Nexia International, visit www.nexia.com.
About CliftonLarsonAllen
CliftonLarsonAllen is a member of Nexia International and is one of the top 10 certified public accounting and consulting firms in the United States. Structured to provide clients with highly specialized industry insight, the firm delivers assurance, tax, and advisory capabilities. CliftonLarsonAllen offers unprecedented emphasis on serving privately held businesses and their owners, as well as nonprofits, and governmental entities. The firm has a staff of more than 3,600 professionals, operating from more than 90 offices across the country. For more information about CliftonLarsonAllen, visit www.cliftonlarsonallen.com.
About CliftonLarsonAllen Wealth Advisors, LLC
CliftonLarsonAllen Wealth Advisors, LLC, an SEC Registered Investment Advisor, offers private wealth advisory services, including asset management and investment planning; strategic financial retirement planning; business succession planning; sell-side representation of mergers and acquisitions*; insurance and risk management; and employee benefit design, compliance, and consulting. The national wealth advisory practice is among the top five in the accounting profession with approximately 100 professionals and nearly $3 billion in assets under management. CliftonLarsonAllen Wealth Advisors, LLC is a wholly owned company of CliftonLarsonAllen LLP, one of the nation’s top 10 certified public accounting and consulting firms delivering assurance, tax, and advisory capabilities.
*Merger and acquisition services provided through CliftonLarsonAllen Wealth Advisors, LLC, member FINRA and SIPC.