Deloitte Mid-Year M&A Survey: Three in Five Business Professionals Expect Deal Activity to Increase

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Jun 14, 2011, 09:10 ET

NEW YORK, June 14, 2011 /PRNewswire/ -- Despite anemic employment growth statistics, an indication that the economy is recovering and businesses are able to move forward with their plans for growth and expansion is reflected in the results of a new survey on merger and acquisitions activity from Deloitte. Nearly two-thirds (60 percent) of business professionals in the United States and Canada surveyed by Deloitte say they expect an increase in the average number of deals their companies pursue annually during the next two to five years.

However, the initial optimism reflected in the survey, "Corporate Development 2011," is tempered by the fact that only 7 percent of respondents feel that previous deals exceeded their expectations while more than one-quarter (31 percent) claim past transactions ultimately failed to meet expectations.

"As financial markets stabilize and C-suite confidence in the recovery returns, many companies are refocusing on growing their businesses, and they're looking to mergers and acquisitions as a potential catalyst to accelerate growth," said Chris Ruggeri, a principal with Deloitte Financial Advisory Services LLP and its merger & acquisition services leader. "Many respondents believe 'transformative deals'— long-term, growth-oriented deals that potentially cause the acquiring company to change its business model or practices—will increase in coming years. The rub lies in executing deals to meet or exceed companies' expectations."

Additional key survey findings include:

Nearly half (49 percent) of respondents think their companies seriously consider as many as four M&A transactions per year.
More than half (54 percent) of business professionals surveyed view corporate development as a career destination in their companies.
More than one-third of respondents (39 percent) believe the leading way to enhance their corporate development effectiveness is through improvements in organization and process.

"Companies increasingly recognize that a well-conceived transition from strategy through transaction execution and integration of a target can have a positive impact on realizing the companies' expected deal results," Ruggeri added. "We're seeing the role of corporate development professionals start to expand beyond deal execution in many companies to include post-merger integration. Keeping the corporate development team aligned after negotiations are finished is an important area companies should not overlook."

To download a copy of the survey, please go to www.deloitte.com/us/cd2011.

About the Survey

Deloitte conducted an online survey of 325 corporate development professionals from March 28 to April 25, 2011. Professionals surveyed were located in the U.S. (84 percent) and Canada (7 percent). They were comprised of corporate development/M&A professionals at the company, business unit, or subsidiary head (20 percent), executive (22 percent) and staff (21 percent) levels, as well as CFOs (8 percent) and CEOs/presidents (8 percent).

Respondents represented both public (60 percent) and private (40 percent) companies. Annual company revenues among respondents were more than $5 billion (28 percent), $1 billion to less than $5 billion (26 percent), $500 million to less than $1 billion (11 percent), and less than $500 million (35 percent).

For the purposes of the survey, corporate development refers to a broad range of activities that support and enable M&A-related growth.

As used in this document, "Deloitte" means Deloitte LLP and its subsidiaries. Please see www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting.