Mergers & acquisitions trends forecasted

Abstract

M&A (Mergers and Acquisitions) is a topic of immense importance: in 1999 so far there have been over 9,218 transactions in the U.S. alone, with a total deal value of over $1.4 trillion . The purpose of this thesis is to forecast which U.S. industries are likely to have the greatest growth in the number of M&As, as well as in the dollar volume of these transactions (excluding those that have had the greatest growth the last five years). The knowledge of which these potentially overlooked industries are can be very lucrative. Previous research on this topic is presented and evaluated. There are multiple careful empirical examinations (including time series, box plot, and cluster analyses) of the 1983-1997 aggregate M&A time series for each of the 50 largest U.S. industries. Careful surveys of fundamental factors are performed on the initial findings in order to complement the inherent limitations of pure empirical forecasts. It is found that the fundamental factors appear to support the initial empirical findings. The conclusion is that the following four industries have the greatest growth potential in the near future: `Plastics and Rubber'; `Electronics', `Real Estate'; and `Agricultural Production'.