Compelling stat from Thomson Reuters, via its weekly Investment Banking Scorecard: the value of deals withdrawn is almost equivalent to the total value of completed M&A for 2008.
Withdrawn M&A deals totalled US$322bn so far in Q4, closing in on the level of completed M&A (US$362bn). Quarterly cancellation rate (nbr. cancelled / nbr. completed) is at a 2 year high and shows that in Q4 for 100 M&A deals completed about 7 got pulled off.
Global M&A activity is down 27 per cent compared with this time last year, according to Thomson Reuters data. On a more granular level, private equity deal making (or least, deal completing) has fallen 71 per cent year on year.
Another lowlight: BHP Billiton’s withdrawal of its US$188bn hostile offer for Rio Tinto will go down as the largest ever broken deal. BHPs advistors can’t be happy either, since according to Thomson Reuters their estimated fee pool is around $140m. Rio Tinto’s advistors stand to lose out on even more than that; their fee pool is estimated at $162m.
Related links:
It’s tough out there in swingin’ singles’ land – FT Alphaville
Top ten Q4 deals to date (including nifty spreadsheet) – PEHUB