The worldwide boom in mega mergers and acquisitions (M&A) valued at more than $10 billion saw a new high in the second quarter (Q2) of the year against none for the corresponding period in 2014, a report said.

The overall volume of M&A  remained high for the third consecutive quarter, according to the latest Quarterly Deal Performance Monitor of Towers Watson, a leading global professional services company, which noted that the period saw 48 large (over $1 billion) deals completed in Q2.

The research – run in partnership with Cass Business School – also revealed that acquirers achieved an excellent financial performance this quarter continuing the unbroken run of ten consecutive quarters of outperformance, which saw deal-makers returning a median market outperformance of 6.2 percentage points (pp); almost double that of the prior quarter.

Steve Allan, M&A Practice leader (EMEA) at Towers Watson, said: “As the merger-wave that began a year ago continues unabated, deal-makers are now operating under a seemingly ‘buy big or go home’ mentality, which carries higher risks but also potentially more substantial returns, judging by recent performance figures.”

“An unintended consequence of the trend towards larger deals is, that due to their greater complexities, deals are taking longer. Evidence of this is an increase this quarter of ‘slow’ deals; those taking 70 or more days to complete. Our research focuses wholly on completed deals, so we anticipate a very active third quarter this year when the unusually large number of deals announced in April and May should reach fruition,” he added.

Geographically, the picture this quarter is relatively unchanged. From a volume perspective, North America continues to lead the pack with 93 completed deals, followed by Asia-Pacific with 58 deals and Europe with 34.

Meanwhile, Asia-Pacific maintains a stunning outperformance for another quarter at 19pp above the regional index. This contrasts with a 3.2pp outperformance by North American acquirers and a return to positive performance of 0.2pp for European acquirers, above their respective regional indices.

“This has been an interesting period for M&A from a number of angles. We will continue to monitor closely for signs of a climax to the current boom time. More specifically, and as predicted, the financial sector remains one to watch and is now showing early signs of a comeback in volumes this quarter,” Allan added. – TradeArabia News Service