European companies are coveted by their international counterparts, especially American ones, who have rushed into the market in search of bargains in the wake of the equity rally following Donald Trump's presidential victory last November. It remains to be seen whether the momentum will continue in the coming months, also given the slowdown in the last few sessions, but for the moment the data leave little room for doubt: according to data from Thomson Reuters, reported by the Financial Times, in the first quarter of 2017, mergers and acquisitions in Europe totaled $215,3 billion, up 16% from the same period last year and the most since 2008 for the period in the region. The sharp increase in transactions was supported by the fact that US companies spent more than ever, paying out 114 billion dollars, more than half of the total for the quarter. "There have been more cross-border deals in Europe because there is more optimism about the health of the region, which sees a little more growth and greater political stability," said Blair Effron, co-founder of Centerview Partners. Conversely, foreign interest in American companies has dropped sharply, with bids dropping to their lowest since early 2014.
According to analysts, the protectionist rhetoric of President Trump, which discourages acquisitions by international groups, weighs in particular, but also the fact that Chinese companies have shown themselves to be less inclined to put their hands on their wallets, put under pressure by the control policy of capitals launched in China. In particular, acquisitions of US companies by foreign counterparts fell by nearly a quarter to $86,9 billion, while those between US groups rose by only 3%, suggesting a greater uncertainty and caution also on the part of American investors after the acceleration following the election of Barack Obama's successor. “While there was a healthy amount of M&A by US companies overseas in the first quarter, buoyed by strong valuations, favorable exchange rates and easy access to low-cost financing, the predominant sentiment is now becoming more wait-and-see, to understand what will happen with Trump's tax reform and protectionist policy,” said Scott Barshay, an expert at the Paul Weiss law firm. Overall, global M&A activity jumped 7% in the first quarter to $726,5 billion compared to the same period last year, a figure that would be even higher if Kraft-Heinz had managed to get its hands on Unilever (the 143 billion merger foundered at the beginning of the year). “From a business perspective, the mood is quite positive at the moment, but going forward, senior management will need to be more certain about the outlook. Without these, there is no rush to move forward with mergers,” said Leon Kalvaria, head of Citigroup's Institutional Clients Group division.
