Rebound in European M&A begins to take a firmer hold

GREEN shoots have started to take a firm hold in the M&A arena, with European deal value soaring this year compared to the first half of 2009.

A total of €182.7bn (£151.8bn) worth of deals came to the market in the first six months of 2010, an increase of over 25 per cent on last year, according to the latest Deal Drivers report from MergerMarket, Hay Group and Merrill DataSite.

But while deal flow is looking decidedly healthier than last year, the report warns that the figures remain some of the worst on record, showing that the market still has a long way to go before it picks up to normal levels.

The industrials and chemicals sector led in terms of volume over the period, accounting for 20.8 per cent of all European deals. Geographically, distressed deals drove activity in the UK and Ireland, which accounted for a quarter of all M&A by volume and value over the six months. And Credit Suisse raked in the lion’s share of the advisory work, advising on 57 deals worth a combined €67.5bn.

The Pru’s $35.5bn bid for AIA was the largest deal on the cards before it fell through, to be replaced by drug giant Novartis’ €18.25bn bid to take full control of Alcon.