Finance and the Economy Series: Mergers and Acquisitions

New Zealand Management, July 2011 | Go to article overview

Finance and the Economy Series: Mergers and Acquisitions


Byline: Steve Hart

Merger and acquisition activity in New Zealand is sitting at around 20 percent of its pre-global financial crisis level according to Chas Cable of Deloitte. But it is starting to rise, thanks mainly to Asian investors eyeing up our dairy firms and state-owned power companies.

Cable heads up Deloitte's corporate finance team which handles the company's M&A work. He says that before the GFC there was an elevated level of M&A activity around the world -- driven by easy credit and private equity firms flush with cash.

"A lot of that activity was being driven by private equity firms who tended to inject high levels of gearing into their deals," says Cable. "But as soon as the GFC came along, and the banks brought down the shutters, the availability of debt went away and liquidity went out of the market -- that turned the M&A market off very quickly."

Cable says business owners haven't been selling because they have found it impossible to get the price they want. On the other side of the coin, the banks haven't been lending to finance M&A deals.

"That left private equity (PE) firms to fund M&As, but they have not all been in a position to step in either," says Cable. "Not only are private equity firms not buying new assets, they probably have a bunch of assets that are highly geared. Given the economy, that gearing would have looked highly aggressive.

"A lot of those larger PE firms around the world aren't yet truly back in the market because they are busy mending fences inside their own funds."

In February 2010 there was talk of a recovery in the global economy and hopes of an increase in M&A activity. While there was talk of 'green shoots' the predicted up-turn has been slow to surface.

"I think that while there are some PE firms that have told us they have been quite busy, my general observation is that it hasn't happened as much as we would have predicted a year ago," says Cable.

"However, there are some signs that the M&A market is going to open up. We are starting to get visits again from Australian PE firms, who like to come over and make sure they are being thought of, and that we will show them deals. …

The rest of this article is only available to active members of Questia

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Buy instant access to cite pages or passages in MLA 8, MLA 7, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

(Einhorn 25)

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Note: primary sources have slightly different requirements for citation. Please see these guidelines for more information.

Cited article

Finance and the Economy Series: Mergers and Acquisitions
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Help
Full screen
Items saved from this article
  • Highlights & Notes
  • Citations
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Buy instant access to cite pages or passages in MLA 8, MLA 7, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    Thanks for trying Questia!

    Please continue trying out our research tools, but please note, full functionality is available only to our active members.

    Your work will be lost once you leave this Web page.

    Buy instant access to save your work.

    Already a member? Log in now.

    Search by... Author
    Show... All Results Primary Sources Peer-reviewed

    Oops!

    An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.