The survey of over 100 top dealmakers finds strong confidence in the global M&A market in 2013. North American, European, and Greater China advisors largely expect increased deal activity globally and within their own regions compared to 2012. Key drivers are seen as strong CEO confidence, improving economies, and growing appetite for Chinese outward expansion. In North America, domestic deals and the consumer goods sector are expected to be most active. Greater China advisors anticipate outbound Chinese deals, while European advisors foresee foreign acquisitions in Europe driving activity.
3. FOR THE SIXTH CONSECUTIVE YEAR, the Brunswick Group M&A Survey has
polled leading deal practitioners on their outlook for the coming year’s deal landscape and trends. This
is the first year soliciting European advisors’ views and the second with insights from Greater China.
Over 100 top deal bankers and lawyers participated in this year’s global survey, and their views indicate
that 2013 is shaping up to be a banner year:
• 2013 opens with record-setting confidence in the global M&A landscape with North America-
based, Greater China-based and Europe-based advisors expecting deal activity globally to increase
(82%, 74%, and 88%, respectively) over 2012. 97% of North American advisors see activity within
North America increasing in 2013.
• North American and European advisors see this uptick being driven by strong CEO and Board
confidence (64% and 72%, respectively, see this as the key driver), while 69% of Greater China-
based advisors see growing appetite among Chinese State Owned Enterprises for outward
expansion as the top factor.
• North America-based advisors see M&A activity as more likely among domestic players (71%)
than inbound (18%) or outbound (3%) pursuits; Greater China-based advisors see M&A activity
being driven by Chinese companies pursuing outbound deals (77%); and Europe-based advisors see
foreign companies pursuing deals within Europe (59%) driving local M&A activity.
• In North America, the ripest sectors seen for consolidation are consumer goods (31%) and
technology and telecoms (22%), while manufacturing (20%), technology (20%) and consumer
goods (16%) are expected to fuel activity in Greater China. In Europe, energy and financial services
are expected to drive the uptick (24% see each as the most active sector).
• 89% of North America-based advisors expect leveraged buyouts to make a major comeback
in 2013.
The results of the survey are released ahead of the 25th Annual Tulane University Law School Corporate
Law Institute, the leading M&A conference in the U.S. that draws lawyers, bankers, Delaware judges,
proxy solicitors and other members of the deal community.
For further information: www.brunswickgroup.com/insights-analysis/surveys.aspx
4. 1a. Compared to 2012, do you expect the level of North American
1. Compared to 2012, do you expect the level of Northin 2013?
M&A will increase, decrease or stay the same level American
M&A will increase, decrease or stay at the same level in 2013?
92% 97%
78%
48%
42%
22%
8% 10%
0% 3%
0% 0%
2010* 2011** 2012 2013
Increase Stay the same Decrease
North American advisors are overwhelmingly bullish on North American deal activity for the
coming year with not a single respondent expecting a decrease in North American deal flow
during 2013.
* In 2010, the question was written as “Given the Level of M&A in Q1, do you expect activity for the rest of 2010 to…?”
** In 2011, the question was written as “Given the level of domestic M&A in Q1, do you expect activity for the rest of 2011 to:”
* In 2010, the question was written as “Given the Level of M&A in Q1, do you expect activity for the rest of 2010 to…?”
** In 2011, the question was written as “Given the level of domestic M&A in Q1, do you expect activity for the rest of 2011 to:”
5. 1b. Compared to 2012, do you expect the level of Greater China M&A
Q1b. Compareddecrease or stay the same level in of Greater China
will increase, to 2012, do you expect the level 2013?
M&A will increase, decrease or stay at the same level in 2013?
67%
76%
30%
20%
4%
4%
2012 2013
Increase Stay the same Decrease
Two thirds of advisors surveyed in China expect an uptick in M&A in Greater China in 2013
(67%), down from 76% in 2012.
6. 1c. Compared to 2012, do you expect the level ofof European M&A will
1c. Compared to 2012, do you expect the level European M&A will
increase, decrease or stay at the same level in 2013?
increase, decrease or stay the same level in 2013?
61%
33%
6%
Increase Stay the same Decrease
61% of Europe-based advisors see M&A increasing within the region in 2013, while a third
(33%) believe the level of activity will stay the same and 6% see a decrease.
7. 2. Compared to 2012, do you expect the level of global M&A will
2a. Compared to 2012, do you expect the level of global M&A will
increase, decrease or stay at thethe same level 2013?
increase, decrease or stay at same level in in 2013?
3%
23% 15%
28%
82%
49%
2012 2013
Increase Stay the same Decrease
North America-based deal practitioners expect to see increased global activity in 2013, up
33 percentage points from a year earlier, with just 3% expecting a global decline in deal flow.
8. 2b.Compared to 2012, do you expect the level of global M&A will
Q2b. Compared to 2012, do you expect the level of global M&A will
increase, decrease or stay at the same level in 2013?
increase, decrease or stay at the same level in 2013?
8% 4%
22%
36%
74%
56%
2012 2013
Increase Stay the same Decrease
Three in four (74%) Greater China based advisors expect global M&A activity to be on the
rise this year, up from 56% last year.
9. Q2c. Compared to 2012, do you expect the level of global M&A will
increase, decrease or stay at the same level in 2013?
2c.Compared to 2012, do you expect the level of global M&A will
increase, decrease or stay at the same level in 2013?
88%
12%
0%
Increase Stay the same Decrease
Nine in ten (88%) European advisors foresee an increase in global deals this year and 12%
expect levels to be consistent with last year. Not a single European advisor that was surveyed
expects a decrease in global M&A this year.
10. 3. Compared to 2012, do you expect the level of North American
3. Compared to 2012, do you expect the level of North American
corporate spinoffs and divestitures will increase, decrease or or stay the
corporate spinoffs and divestitures will increase, decrease stay at at
same level in 2013? 2013?
the same level in
6%
33%
61%
Increase Stay the same Decrease
Three in five North American advisors (61%) see corporate spinoffs and divestitures in
North America rising in 2013, while 33% see the level staying the same and 3% see a
decrease in 2013.
11. 4. What areare the key factors that will drive North American
4a. What the key factors that will drive M&A in 2013? Please select
M&A in 2013? Please select the top three.
the top three.
CEO / Board confidence 64%
61%
Improving economy* 53%
70%
Greater availability of credit and low interest rate 45%
environment** 63%
Shareholder activism / pressure from investors 44%
28%
More cash on balance sheets** 36%
63%
Equity market rebound in U.S.*** 30%
20%
Cost cutting / synergies**** 6%
15%
2013
Other***** 8%
2012
Strong CEO / Board confidence is seen as the primary driver of increased M&A in 2013
while the improving economy and availability of credit will also help fuel the projected
uptick in 2013 M&A activity.
* In 2012, “Improving economy” was fielded as “Economic conditions”
* In 2012, “Improving economy” was fielded as “Economic conditions”
**** 2012, “More cashcashbalance sheets” and “Greater availability of creditof credit interest rate environment” were combined and fielded asand fielded
In In 2012, “More on on balance sheets” and “Greater availability and low and low interest rate environment” were combined
“More cash on balance sheets / availability of credit”of credit”
as “More cash on balance sheets / availability
*** In 2012, “Equity market rebound in U.S.” U.S.” was fielded as “Equity recovery”
*** In 2012, “Equity market rebound in was fielded as “Equity market market recovery”
**** In 2012, “Cost cutting / synergies” was fieldedfielded as “Emphasis cutting /cutting / synergy benefits”
**** In 2012, “Cost cutting / synergies” was as “Emphasis on cost on cost synergy benefits”
***** Not asked in 2012
***** Not asked in 2012
12. Q4b. What are the key factors that will drive M&A in 2013? Please
4b.select top three. factors that will drive Greater China M&A in 2013?
What are the key
Please select the top three.
Growing appetite among Chinese SOEs for outward expansion* 69%
84%
Opportunities in struggling Western economies 58%
72%
Growing appetite among privately-owned Chinese companies for 38%
outward expansion* 84%
A more favorable political environment following elections / 31%
leadership transition in the US & China**
Greater availability of credit and low interest rate environment*** 27%
36%
Improving economy**** 19%
36%
More cash on balance sheets*** 15%
36%
Shareholder activism / pressure from investors 15%
4%
CEO / Board confidence 12%
4%
Cost cutting / synergies***** 8%
4% 2013
0%
Other
8% 2012
There remains clear consensus among deal advisors in China that state owned entities have
a strong appetite for outward expansion by pursuing foreign companies (69% see as the key
driver2012,2013, appetite among Chinese SOEs for outward expansion “ and “Growing appetite among privately-owned Chinese companies for outward
* In
in “Growing compared with 84% in 2012).
expansion” were combined and asked as “Growing appetite for outward expansion among Chinese companies”
** Not asked in 2012.
* In 2012,2012, “More appetite among Chinese SOEs for outward expansion “ andrate environment” were combinedprivately-owned Chinese
*** In
“Growing cash on balance sheets” and “Greater availability of credit and low interest “Growing appetite among and fielded as “More cash on
companies for outward expansion” were combined and asked as “Growing appetite for outward expansion among Chinese companies”
balance sheets / availability of credit”
** Not asked in 2012. economy” was fielded as “Economic conditions”
**** In 2012, “Improving
*** In 2012,2012, “Cost cutting balance sheets” and “Greater availability of / synergy benefits”interest rate environment” were combined
***** In “More cash on / synergies” was fielded as “Emphasis on cost cutting credit and low
and fielded as “More cash on balance sheets / availability of credit”
**** In 2012, “Improving economy” was fielded as “Economic conditions”
***** In 2012, “Cost cutting / synergies” was fielded as “Emphasis on cost cutting / synergy benefits”
13. 4c. What are the key factors that will drive European M&A in 2013?select
4c. What are the key factors that will drive M&A in 2013? Please
Please select the top three.
top three.
CEO / Board confidence 72%
Greater availability of credit and low interest
56%
rate environment
Cost cutting / synergies 50%
More cash on balance sheets 39%
Shareholder activism / pressure from investors 28%
Improving economy 17%
Further development of the Euro Crisis 6%
Other 17%
Europe-based M&A advisors see rising CEO / Board confidence and attractive
financing opportunities as key drivers for M&A in 2013 (72% and 56%, respectively,
see these as key factors).
14. 5. What type of deals do you expect to drive the North American M&A
5a. Whatin 2013? deals do you expect to drive the North American
market type of
M&A market in 2013?
Domestic
transactions
among strategic
buyers – 71%
$$$ Private
Inbound – equity – 8%
foreign acquirers into the
Outbound –
U.S. – 18%
U.S. acquirers outside
of the U.S. – 3%
Deals among domestic players are overwhelmingly seen (71%) as the most likely driver
of the 2013 North American deal market and inbound pursuits remain a consideration
(18%), while outbound (3%), and private equity (8%) plays are expected to take a
back seat in 2013.
15. Q5b. What type of deals do you expect to drive the Greater China
M&A market in 2013?
5b. What type of deals do you expect to drive the Greater China
M&A market in 2013?
Outbound –
Greater China acquirers
outside of Greater
China – 77%
Domestic
transactions
among strategic
buyers – 12%
$$$ Private
equity – 12%
Looking at what types of deals will drive M&A in Greater China, three fourths of
China-based advisors surveyed (77%) see Chinese companies pursuing foreign opportunities
while 12% expect domestic transactions among strategic buyers and 12% expect private
equity to dominate the landscape.
16. 5c. What type of deals do you expect to drive the European M&A
market in 2013?
5c. What type of deals do you expect to drive the European
M&A market in 2013?
Private equity –
18% Domestic transactions Outbound – European
among strategic buyers – acquirers outside of
6% Europe – 18%
Inbound – foreign acquirers
into Europe – 59%
Looking at what types of deals will drive M&A in Europe, three in five Europe-based
advisors surveyed (59%) see foreign acquirers pursuing opportunities within Europe
while 18% expect private equity and 18% see European companies pursuing foreign
opportunities to be key factors.
17. 6.6a. What sector do you anticipateisismost ripe for consolidation in 2013?
What sector do you anticipate most ripe for consolidation in
North America in 2013?
4% 2% 2% Other
5% 5% 2%
6% 5% 2% 5%
Automotive
8% 8% 14% 10%
Utilities
17% 14%
24% 17% Media
15% Metals / Mining
24%
21% Industry / Engineering
25% 22%
Financial services
18% 17%
Healthcare
15%
13% 13% 31% Energy
14% 10% Technology & Telecoms
9%
Consumer goods / Retail
2009 2010 2011 2012* 2013
For the first time, deals in the consumer goods sector are seen as the most likely, with the
percentage of advisors selecting that sector as the most active tripling since 2011 (31%, up
from 10%). The technology / telecoms (22%) and energy sectors (15%) are expected to
also be ripe for consolidation in 2013.
* No data for 2012
* No data for 2012
18. Q6b. What sector do you anticipate is most ripe for consolidation in
2013?* sector do you anticipate is most ripe for consolidation in
6b. What
Greater China in 2013?
0% 8% Other
16% 0%
4% Healthcare
0% 4%
8% 4% Logistics
8%
Financial services
16% 8%
0% Property
8%
4%
Transportation
20% 16%
Raw / Industrial materials
Energy
20%
20% Consumer goods / Retail
Technology
4%
20% Manufacturing
12%
2012** 2013
Among China-based advisors surveyed, the ripest sectors for consolidation are
manufacturing (20%), technology (20%) and consumer goods (16%).
* “Telecoms” and “Utilities” were fielded in 2012 and 2013, but received 0% each year.
** In 2012, question was asked as “In what sector in Greater China do you expect to see the greatest amount of consolidation in 2012?”
* “Telecoms” and “Utilities” were fielded in 2012 and 2013, but received 0% each year.
** In 2012, question was asked as “In what sector in Greater China do you expect to see the greatest amount of consolidation in 2012?”
19. 6c. What sector do you anticipate is most ripe for consolidation in 2013?*
6c. What sector do you anticipate is most ripe for consolidation in
Europe in 2013?
6% Financial services
6% Energy
24%
6% Industry / Engineering
6% Automotive
Healthcare
12% Technology & telecoms
Utilities
24% Metals / mining
18%
The financial services and energy sectors in Europe are expected to be the busiest in 2013,
with one in four (24%) advisors surveyed in Europe believing each will be the ripest for
consolidation.
* “Consumer goods / retail” and “Media” were also fielded but each received 0%.
* “Consumer goods / retail” and “Media” were also fielded but each received 0%.
20. 7a.What region do you anticipate the most foreign acquirers into North
7. What region do you anticipate the most foreign acquirers into
American coming from in 2013?
North America coming from in 2013?
Europe – 23%
Asia – 61%
Australasia – 5%
Latin America – 11%
Asia is expected to be the predominant foreign buyer in North America (61%), but less so
than last year when it peaked with 78% of expected in-bound activity. 23% of respondents see
Europeans as the most likely buyer, while 11% see Latin America as a possible acquirer, marking
a steady uptick in the second year it has been considered in the survey (from 4% in 2012).
21. 7b.What region do you anticipate the most foreign acquirers into
7b. What region do you anticipate the most foreign acquirers into
North American coming from in 2013?
Greater China coming from in 2013?
Europe – 12%
North America –
58%
Middle East – 8%
Latin America – 4%
Australasia – 19%
For Greater China based advisors, North America is expected to continue to be the top
foreign buyer in Greater China (58%). Fewer respondents expect Europeans to be the
most active in Greater China this year (12%, down from 21%), while more advisors see
buyers from Latin America (19%, up from 13%), the Middle East (8%, up from 4%), and
Australasia (4%, up from 0%) on the rise.
22. 7c. What region do you anticipate the most foreign acquirers into
7c. What region do you anticipate the most foreign acquirers into
North American coming from in 2013?
Europe coming from in 2013?
North America – 61% Asia – 39%
European advisors believe foreign acquirers are most likely to come from North America
(61%), with Asia closely behind (39%).
23. 8a. Do you expect to see more deals using:
8. Do you expect to see more deals using:
69%
63%
57%
66%
28%
38% 35%
27%
6% 5% 3% 5%
2010 2011 2012 2013
All cash All stock A mix of cash and stock
For the fourth consecutive year, advisors in North America expect an increase in the number
of deals being done with all cash (69%), as opposed to a mix of cash and stock (27%), or all
stock (5%).
24. 8b. Do you expect to see more deals using:
Q8b. Do you expect to see more deals using:
42%
58%
All cash A mix of cash and stock All stock
The majority of advisors in Greater China believe they will be seeing more deals using all
cash (58%), while two in five (42%) believe deals using a mix of cash and stock will be on
the rise. No respondents believe the level of all stock deals will increase in 2013.
25. 8c. DoDo you expect to see more deals using:
Q8c. you expect to see more deals using:
22%
78%
All cash A mix of cash and stock All stock
Nearly four in five (78%) European advisors expect to see more all cash deals in 2013. The
remainder (22%) foresees more deals using a mix of cash and stock.
26. 9. Compared to 2012, do you think the level of mega-deals and
leveraged buyouts will do you think the level of mega-deals andlevel in
9. Compared to 2012, increase, decrease or stay at the same leveraged
2013? buyouts will increase, decrease or stay at the same level in 2013?
11%
89%
Increase Stay the same Decrease
Nearly nine in ten North American advisors (89%) believe 2013 will mark an increase in the
level of mega-deals and leveraged buyouts.
27. 10. Do you expect to see more distressed M&A transactions to take
place inside of bankruptcymore distressed M&A transactions to take place
10. Do you expect to see or outside of bankruptcy?
inside of bankruptcy or outside of bankruptcy?
22%
78%
Inside of bankruptcy Outside of bankruptcy
Four fifths of North American advisors surveyed (78%) believe distressed transactions will
take place outside of bankruptcy rather than during the Chapter 11 process.
28. 11a. InIn the upcoming year, which of thefollowing buyers do you expect
11. the upcoming year, which of the following buyers do you expect
toto be most active in acquiring distressed assets?
be most active in acquiring distressed assets?
Private equity 49%
Strategic buyers 32%
Hedge funds 17%
Management 2%
Half of North American survey respondents (49%) expect to see private equity buyers as the
most active in acquiring distressed assets, while a third (32%) see strategic buyers and nearly
a fifth (17%) believe hedge funds will enter the mix.
29. 11b. In the upcoming year, which of the following buyers do you expect
Q11b. In the upcoming year, which of the following buyers do you
to be most active in acquiring distressed assets?
expect to be most active in acquiring distressed assets?
Strategic buyers 46%
Private equity 29%
Hedge funds 8%
Management 8%
Lenders 8%
Greater China advisors expect strategic buyers to lead private equity in terms of buying dis-
tressed assets (46% vs. 29% respectively).
30. Q11c. In the upcoming year, which of the following buyers do you
11c. In the upcoming year, in acquiring distressed assets? do you expect
expect to be most active which of the following buyers
to be most active in acquiring distressed assets?
Private equity 50%
Strategic buyers 39%
Hedge funds 11%
Management 0%
European advisors predict that distressed assets will go to a mix of private equity (50%) and
strategic buyers (39%).
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