View from the Observation Deck

1. The average one-day premium (offer price vs. previous day’s closing price) for global M&A transaction announcements this year is 36.9% (thru 3/6), according to S&P.
2. Since 2001, the highest average for a calendar year was 37.1% in 2009.
3. According to data just released from Accenture, M&A deals made from 2002-2009 created shareholder value for the acquirer 58% of the time.
4. Studies in the 1990s found that the merger failure rate was as high as 70%.
5. That type of track record is why, for some investors, capturing the premium-paid in the initial stages of an acquisition is so critical.
6. Global M&A deal volume is off by approximately 16% (y-o-y) so far this year, according to Fortune. U.S. activity is down 60%.
7. The sluggishness is being attributed largely to geopolitical stresses and activity is expected to rebound. The world’s largest corporations remain awash in cash.