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M&A breaks records but dealmakers fear for 2016

Date: 2015-12-28
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Dealmakers are worried that bond market turmoil and global instability could hit mergers and acquisitions in 2016 after deals reached an all-time high this year, surpassing 2007's peak.

Driven by a surge of tie-ups in the pharmaceuticals, energy and consumer sectors, the total value of announced transactions has climbed to $4.6tn, compared with $4.3tn eight years ago, according to Thomson Reuters data.

Many of these deals have been for tens or hundreds of billions of dollars, including blockbuster tie-ups between drugmakers Pfizer and Allergan, brewers AB InBev and SABMiller, and oil majors Royal Dutch Shell and BG Group.

Hunger for growth in a weak economic environment, cheap financing and continued pressure from activist shareholders to boost returns drove many companies to combine.

Dealmakers have said these fundamentals remain broadly intact for 2016. However, many have also warned of growing fears among their peers that a fresh terror attack, like that in Paris last month, or another financial crisis could tarnish business confidence and bring the M&A run to an end.  

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