Economic circumstances could change, but as of right now KPMG LLP expects the recent surge of mergers and acquisitions to be sustained through the rest of 2005.
Nearly 40% of the U.S. companies responding to a recent survey by the professional services firm expect the number of worldwide M&A transactions to again total more than 30,000. Nearly 90% of the companies expect to complete at least one merger or acquisition this year, some 20 percentage points higher than last year's 70%.
An improving U.S. economy is a major force behind this year's expected M&A activity. It was cited by 54% of the 112 companies responding to the survey as the factor that would most affect mergers and acquisitions. International events and increased stock prices also are also expected prompt mergers and acquisitions.
The survey, which was conducted in late December 2004, suggests that high-tech companies, financial services firms and healthcare companies will experience the most M&A activity in 2005. Other active areas: telecommunications, consumer products and services, and energy and power.