Merger & Acquisition activity is suffering more from Covid-19 in North America than in European and Asia-Pacific nations, according to a study released today by from Willis Towers Watson.
In the first half of this year, U.S. and Canada deals totaled 137 compared to 188 for the same period last year.
By contrast, the numbers were 80 versus 68 in Europe and 82 versus 95 in the Asia-Pacific region.
The North American deals were the lowest total for the combined countries for a six-month period since 2009, the consulting firm noted.
“Economic uncertainty caused by the pandemic seems to have had a far greater negative impact on the ability of U.S. companies to initiate and successfully complete M&A negotiations,” said David Hunt, senior director, Human Capital and Benefits, M&A for Willis.
He predicted deal making will become more selective partly driven by distressed M&A and non-core divestitures at bargain prices even as Covid-19 subsides.
The Willis Towers Watson report noted the impacts economic uncertainty surrounding coronavirus includes that deals that are being done are taking longer—-8 percent longer to close than they did in the first half of 2019.
“This trend is likely to endure,” said the authors.
Covid-19 was an additional insecurity for deal makers already burdened with uncertainties from trade disputes, the threat of global recession, the rise of shareholder activism and the presidential election, the report asserted.
Source: forbes.com