Global mergers and acquisitions slumped this quarter to a level not seen since the aftermath of the financial crisis amid increasing concern the economic recovery is deteriorating.
Companies have announced $446 billion of takeovers since June 30, the smallest amount since the third quarter of 2009, according to data compiled by Bloomberg. Chinese state-run oil company Cnooc Ltd.’s proposed purchase of Nexen Inc. was the only transaction to top $10 billion in the period, the data show. Acquisitions are now on pace to drop 15 percent in 2012 to $2 trillion, the lowest in three years.
There are fewer deals to fight over this year, partly because of Europe’s extended sovereign-debt woes. The crisis has forced leaders to implement aid packages in Greece, Ireland and Portugal to help preserve the 17-nation euro zone, with the euro area bound for recession. That put a damper on the merger market, said Adrian Mee, London-based head of international M&A at Bank of America Corp.
“This is a trend that will continue for a significant period of time,” said Nigel Robinson, London-based head of energy and natural resources at Deutsche Bank AG.