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The Coming Takeover Boom: 3 Sectors Ripe for Mergers & Acquisitions
On Monday, $24.8 billion worth of takeovers were announced. It was the third busiest Merger Monday on record in 2009. Yet most investors remain unimpressed….
They’re convinced it’s nothing more than a short-lived Darwinian event. Weak and unfit companies, exposed by a nasty recession, are simply being forced into the arms of the strong. Or as Jack Ablin, Chief Investment Officer at Harris Private Bank puts it, “A lot of these deals are motivated by self-defense.”
But they’re wrong.
Even though this Monday wouldn’t even make the cut for the top 20 deal days during the last takeover boom (in 2007), it’s more…
23Apr2009 | Investment U | 0 comments | ContinuedDon’t Expect The $68 Billion Pfizer-Wyeth Deal To Lift Merger Market
When Pfizer Inc. (PFE) unveiled a $68 billion buyout offer for U.S. rival Wyeth (WYE) last week, it sparked hopes that the deal might re-ignite the moribund merger market. But when the Wall Street dealmakers take a closer look, those flames will likely be doused in cold water.
For those rooting for a revival of buyout activity, the merger of the two companies shows that corporate predators are still on the prowl and adequate financing is still available for some big transactions.
But as Money Morning reported recently as part of its ongoing “Outlook 2009” economic forecasting series, the credit crisis has put…
2Feb2009 | Money Morning | 0 comments | ContinuedOverly Leveraged Private Equity Deals Add to Unemployment and Deepen Recession
The once booming business of private equity faces an uncertain future. What’s not uncertain, however, is that many private equity deals are imploding from the weight of leveraged debt and greed. Inevitable bankruptcies will result in higher unemployment and a deeper recession.
Private equity is an asset class consisting of equity securities in operating companies that are not publicly traded. The name “private equity”is the rechristened, kinder and more gentile label for what used to be known as leveraged buyouts, or LBOs. But make no mistake about it, while leverage may not be part of the name any more, it remains…
11Dec2008 | Money Morning | 0 comments | ContinuedTHE INNOVATOR, THE IMITATOR AND THE IDIOT
While in Vienna last week, I grabbed hold of the international edition of The Wall Street Journal. Over a classic Viennese breakfast of coffee, a boiled egg and pastry, I stumbled across an interview with Ted Forstmann, titled, “The Credit Crisis Is Going to Get Worse.”
I hadn’t seen Forstmann’s name in years. He once lorded over one of the world’s most famous private equity firms, Forstmann Little. For a time, it was, as the Journal notes, “the most successful private equity firm in the world, renowned for both its outsized returns and its caution.” When things got a little too…
24Jul2008 | Daily Reckoning | Comments Off | Continued
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