North American M&A slump continues

North America had the poorest M&A performance of all global regions in the third quarter of 2019, with an underperformance of -6.9 percentage points based on share-price performance for deals valued at more than $100m, according to Willis Towers Watson’s Quarterly Deal Performance Monitor (QDPM), run in partnership with Cass Business School.  

The poor result has contributed to the global M&A market recording its second worst performance since QDPM began monitoring the market in 2008. Overall, M&A transactions are taking longer to close, with deals completed in the first nine months of 2019 taking 140 days to finish, on average, compared with 119 days for the same period in 2018.

Large deals – those valued at more than $1bn – had their worst quarterly volume since 2009 and are set to have the lowest annual volume since 2013. “[Global] deal volumes continue [their] annual downward trend. The past 10 years have been relatively good times for dealmakers. Now trade wars, Brexit, weakness in China’s economy and forecasts for slower growth are weighing down sentiment in capital markets, indicating more difficult times ahead,” said Jana Mercereau, head of corporate M&A for Great Britain at Willis Towers Watson. 

In Europe, the latest quarter ended a nine-quarter spree of positive results after underperforming the regional index by -6.7 percentage points. The tumble was partly caused by the worst ever third-quarter result by UK acquirers of -20.0 percentage points, based on only seven completed deals, according to QDPM. 

Asia-Pacific was the only region worldwide to see a positive M&A performance in the third quarter of 2019, with dealmakers in the region beating their local index by 0.8 percentage points, ending a run of 10 consecutive negative quarters.