As U.S. United Parcel Service (UPS) recently announced a US$6.8 billion acquisition of TNT Express, the total value of global M&A transactions this year has risen to nearly US$370 billion. Although this scale has fallen sharply from the same period of last year and the previous quarter, it is noteworthy that the total value of global M&A transactions hit a seven-month high in February this year, indicating that the enthusiasm for mergers and acquisitions is heating up. Analysts believe that with the acceleration of the global economic recovery and the strengthening of the stock market, the M&A market is expected to achieve a strong rebound. It is expected that it will resume its upward trend in the second half of the year and its annual performance will be better than last year.

The M&A market is expected to take off in the second half of the year After experiencing the financial crisis of 2008, the global M&A market has shown signs of recovery in 2010 and has seen strong growth in the first half of last year. However, due to the spread of the European debt crisis, the global stock market dropped sharply. In the second half of last year, the global M&A market experienced a cold wave, and the total value of transactions continued to decline.

According to Bloomberg data, the total value of global M&A transactions last year was 2.28 trillion U.S. dollars, an increase of 4% over 2010, but it has fallen sharply from 24% in the previous year. Since the beginning of this year, the number of global mergers and acquisitions has reached 5,402, with a total value of 369.17 billion U.S. dollars, which is 39% lower than the same period of last year and 24% from the fourth quarter of last year.

Paul Parker, head of global mergers and acquisitions division of Barclays Capital, believes that the decline in M&A activity is mainly affected by the European debt crisis. “This is an important factor affecting the stock market, and stock market performance will dominate the market sentiment. Until the market stabilizes, companies will not carry out M&A activities."

However, Parker also pointed out that with the improvement of the economy to boost stock market performance, global M&A activity will rebound in the second half of this year. “M&A activities mainly follow the performance of the economy and the stock market. If these two aspects improve, M&A activity will rebound strongly.”

On a monthly basis, the value of global M&A transactions reached US$190.14 billion in February this year, which is the highest level since July of last year, indicating that M&A activity has begun to heat up. The largest deal announced so far this year is the acquisition of Xstrata, a Swiss miner, by commodity trading company Glencore International, which has a transaction value of up to US$45 billion.

Peter Weinberger, co-founder of Wall Street investment bank Perrera Weinberger Partnership (PWP) believes that mergers and acquisitions activities have cooled down significantly due to the European debt crisis that damaged investor confidence in the second half of the year, but with US companies globally With business expansion, there will be a “significant recovery” in the merger and acquisition market in the next two years, Weinberger said: “Companies have the desire and demand for global expansion. U.S. companies have sufficient resources and funds to conduct large-scale mergers and acquisitions. ”

According to Bloomberg data, as the most active area of ​​global M&A activity, the total value of M&A transactions in the United States last year reached 862.33 billion U.S. dollars, accounting for nearly 40% of the global total. The IntraLinks DFI index measuring global M&A transactions shows that North American M&A transactions in the fourth quarter of last year took the lead in reversing the downward trend of the previous quarter and rebounded.

According to the results of the fifth annual M&A survey released by the Brunswick Group on the 15th, nearly half of the respondents expect that due to improved economic conditions, the global M&A transaction volume will exceed last year, and another 28% of respondents believe that M & A transactions will be flat, only 23% of respondents expect the transaction volume will decline.

"Despite the slow growth in transactions in the first quarter, the trading environment is still motivated by the strengthening of the economy and the rise in the stock market." Steven Wen, senior partner at the Brunswick Group, said that due to the expansion of cash on the balance sheet and the rise of company executives' confidence , The willingness of corporate mergers and acquisitions is rising.

Mining enthusiasm for mergers and acquisitions rose in many industries, mining mergers and acquisitions recently showed a clear upward trend. In the third quarter of last year, mining began to diverge from the traditional major industries of oil and gas, banking, telecommunications and other mergers and acquisitions, and the scale of mergers and acquisitions rebounded sharply. In the past year, the total value of global mining M&A transactions reached US$158.3 billion, second only to the oil and gas industry, ranking second, accounting for 6% of all M&A transactions.

In particular, since the first quarter of this year, the total amount of global mining M&A transactions has reached US$60.08 billion, surpassing that of the oil and gas industry for the first time, and it has become the industry with the highest value of M&A transactions. The value of the latter’s M&A transactions this year was only US$38.05 billion.

The Blackrock Group analyst, the world's largest asset management company, believes that due to the company's low valuation, there will be a large number of merger transactions in the future mining industry. According to the Bloomberg Global Mining Index, the current valuation of mining listed companies is 11.13 times, and the valuation as of the end of 2011 is 9.28 times, which is far below the average of 20.3 times the past five years. At the same time, mining companies hold ample cash, and a report by Standard Chartered Bank in August last year predicted that the total cash holdings of the six largest mining companies including Rio Tinto will reach 144 billion U.S. dollars by the end of 2013.

Ernst Donald, head of Global Mining and Metals, believes that despite the unstable factors in the global economy, stable corporate fundamentals, strong balance sheets and demand for business expansion will promote the continued growth of global mining M&A activity in 2012.

According to a report issued by PricewaterhouseCoopers earlier this month, despite the economic turmoil and the drop in commodity prices, there were 2,605 mining deals with a total value of about 149 billion U.S. dollars in the world last year. The transaction value increased by 33% compared with 2010. The historical high in 2006 was only 2% lower. The report predicts that the value of global mining mergers and acquisitions may hit a record high this year. Among the hot spots, the top five resources will be gold, copper, coal, iron and silver.