Mergers & Acquisitions: Weighing pros and cons of deal-making
The market for mergers and acquisitions might be heating up, but exclusive research from Retail Leader indicates fewer than half of companies expect to buy or sell a business unit in 2013.
About four out of 10 survey respondents indicated their companies had completed an acquisition in the past 12 months, while about one in four had divested a unit. But few reported acquisitions that had a substantial impact on the company's revenue stream. The majority of respondents said acquisitions made during the past five years accounted for less than 10 percent of company revenue.
When considering an acquisition, executives said the two most important factors in the decision-making process were the purchase price and the cost of developing a new line organically.
The survey also indicates executives are gaining confidence in the economy, with 41 percent reporting a positive view of current business conditions compared with 24 percent a year ago. Further, 57 percent indicated they believe the economy will be stronger in the next six months compared with 42 percent of respondents a year ago.