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M&As nosedive since economic crisis

Jamie Dunkley
Wednesday 12 December 2012 19:14 EST
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The value of mergers and acquisitions (M&A) deals completed in the UK has fallen by two-thirds since the start of the financial crisis, it has emerged.

Economic turmoil has resulted in companies sitting on billions of pounds worth of cash instead of spending, accountancy Ernst & Young said yesterday.

Across the UK, the total value of deals has reached $133.6bn (£82.79bn) so far this year, the third highest in the world behind US and China, but 65 per cent lower than during the credit boom of 2007.

Jon Hughes, head of Ernst & Young's transaction advisory services practice, said: "Caution and a distinct lack of confidence underpinned M&A sentiment in 2012 and has created a bias towards risk avoidance and inertia.

"But simply sitting on cash in the hope of an upturn is a foolhardy approach."

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