We recently updated our M&A figures to see how the amount and size of deals have been tracking this year. As shown, the total number of announced deals and total dollar value is tracking well above last year's record numbers.
We also highlight the average premium of all announced deals on a yearly basis to see how much buyers are willing to pay. Some investors use this premium to gauge the level of frothiness in the market. When premiums start rising, it is a sign that buyers are becoming irrational and less disciplined in their acquisitions. Thus far this year, the average deal premium is actually lower than it was in 2006 and 2006.
For in-depth analysis on this topic and much more, visit www.BespokePremium.com.
One thing going well for the market today regarding M&A -- the deals have a high proportion of cash, as compared to stock.
Posted by: David Merkel | June 28, 2007 at 07:40 PM