M&A Stumbles in March

Despite the proposed takeovers of Dell and Heinz, dealmaking on track for worst month in more than three years.

While the proposed takeovers of Dell Inc. and H.J. Heinz Co. dominated headlines in the first quarter, global dealmaking stumbled, with March on track to be the worst month for mergers in more than three years.

Takeovers fell 4.4 percent from a year ago and 36 percent from the previous quarter to more than $461 billion, according to data compiled by Bloomberg as of March 27. Berkshire Hathaway Inc.’s $23 billion purchase of Heinz and the $24.4 billion buyout of Dell Inc. in February failed to spark a rally in March, when mergers shrank to $100 billion, on track for the worst month since 2009.

‘Transformational Deals’

“The ability to do big transformational deals exists,” said Chris Ventresca, New York-based JPMorgan Chase & Co.’s North American head of mergers and acquisitions. “The size of a deal is not a constraint -- the ability to do large deals will be here for the rest of the year.”

Bumps in Road

“There can always be bumps in the road to the recovery like the situation in Cyprus,” said Giuseppe Monarchi, co-head of Europe, Middle East and Africa M&A at Credit Suisse Group AG in London. “If equity markets continue to rally and the European macro situation stabilizes, that should create a more conducive environment for M&A, but the market is still fragile.”

Economic Growth

Consumer spending may have risen by 0.6 percent in February,the most in five months, according to the median of estimates in a Bloomberg survey before the release of Commerce Department figures. The U.S. economy added a net 236,000 jobs in February, almost double the number added in the previous month.

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