The Global Financial Crisis and M&A

Abstract

The global financial crisis is chan ging the landscape for me rgers and acquisitions (M&A) and identifying new M&A targets that indicate a shift with significant impact to our global business practices. Even more now than ever before, companies are implementing strategies th at include gaining access to new geographies. They are responding to the crisis by focusing on growth outside their home country regions, expanding their geographic diversification and investment in secondary markets. Previous M&A activity was focused in the triad of US, Europe and Japan, the world’s largest co nsumer markets. However, as the tr iad’s share of the global consumer market declines companies are looking to new consumer markets that are expanding and open for opportunity. Our research examines the increased complexity and challe nges that cross-border acquisitions need to address in their effort to succeed globally in an environment of instability fueled by ongoing financial turmoil. New development in formulating innovative deal structures an d defining creative terms is apparent. Looking deeper into the supply chain to identify acqui sition targets is becoming attractive pa rticularly in cro ss-border M&A to diversify risk, and maximize control, efficiencies an d productivity. Increasing the influence of shareholders, maximizing legal arrangements and giving consideration to international political implications are all finding their way into the acquirer’s deal structure. M&A advancement in growth markets augments global business innovation and vitality in challenging economic conditions. Cross-border M&A is contributing to the change into our macro global political, social and economic integration