Despite a Subdued Fourth Quarter, 2012 Industrial Manufacturing M&A Value Surpasses 2011 Levels
Strategic Investors Generate 90% of Deals; Financial Sponsors Remain on Sidelines
NEW YORK, NY– Amid high uncertainty over the direction of the global economy, the fourth quarter of 2012 saw a slowdown in the number of announced industrial manufacturing transactions. However, despite the reduction in merger and acquisition (M&A) activity during the last quarter, 2012 proved to be a favorable year for deal making in the industrial manufacturing space. Year over year, the total number of transactions decreased slightly from 2011 but the value of those deals increased substantially, according to Assembling Value, a quarterly analysis of M&A activity in the global industrial manufacturing industry by PwC US.
“The M&A market was overshadowed by a variety of factors that made investors uneasy about making long-term commitments to capital expenditures and hiring,” says Bobby Bono, U.S. Industrial Manufacturing Leader for PwC. “Some European companies slipped into a recession in 2012 due to the foreign debt crisis, while tax implications of the presidential election and resolution of the fiscal cliff in the U.S. seemed to curb enthusiasm for deal making in the last quarter of the year. Although the level of uncertainty regarding the pace of a global recovery remains elevated, we are cautiously optimistic as strong cash reserves and a rebound in the manufacturing sectors of many nations provides hope for continuation of the recovery in industrial manufacturing M&A.”