If you have a hunch that last year seemed like an unusually busy year for the M&A people , youre right. According to CFO magazine, 1998s $1.7 trillion dollar volume of deals announced (not closed) nearly doubled 1997s all-time record. Leading the bunch was the Exxon/Mobil deal, valued at $77.2 billion. Second-largest was SBC Communications intended purchase of Ameritech, valued at $61.4 billion (and still in the regulatory waiting room). BP Americas purchase of Amoco was fourth, at $48 billion.
Other announcements that had a local effectsuch as Rubbermaid and BFGoodrichdidnt even crack the top 10.
Here, according to CFO, are some notable facts about last years extraordinary roster of transactions:
The $661 billion worth of deals in the second quarter alone was higher than any full year in history except 1997.
After nine years as the largest buyout in history, the KKR/RJR Nabisco deal of 1988-89 was surpassed by eight different deals in a 90-day period.
Nine of the 10 largest deals ever were recorded in 1998.
While the overall number of transactions didnt grow in 1998, 46 percent of them were worth $1 billion or more.
It would be mindboggling to assume that 1999 could set yet another record, but the year did get off to a fast start with Fords announced plan to buy Volvo. Plus, the economists CFO talked to say that all the key drivers of the M&A market remain in place.
Increasingly global markets
Earnings pressure resulting from declining currency values overseas
Global over-capacity in certain critical industries, such as automotive
Perhaps some concern about Y2K compliance.