Sorry dealmakers and investment bankers. The record 2015 for global M&A belies uneven prospects for the coming year, said Matt Porzio, Vice President of M&A Strategy at IntraLinks (IL). ‘We are seeing a deceleration in growth,’ said Porzio. ‘It’s still growing, we are predicting 5.5% growth for the first quarter of 2016, but that’s off of 9% growth the previous quarter and 11% growth the quarter before.’ He said early-stage M&A activity is increasing at the slowest rate in 2.5 years as concerns over the global economic slowdown grow. According to Porzio, all the negative sentiment felt by dealmakers is ‘really weighing on deals’. And while mega-deals like the Marriott acquisition of Starwood for $12.2 billion announced today will continue to take place, they are less than 1% of the overall market, according to Porzio. As for the potential effects of a Federal Reserve rate hike in December on dealmaking, Prozio contends it’s a ‘bit of a red herring’. ‘You are not really going to see too much effect with a quarter or half point move because we are still at historic lows for lending,’ said Porzio. ‘However, the uncertainty over how quickly rates will climb before they affect deals is weighing on the minds of dealmakers.’
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