Details

Titel

Lack of Visibility Slows MA

Ist Teil von

• MIN's B 2 B, 2009, Vol.12 (26)

Ort / Verlag

Potomac: Access Intelligence, LLC

Erscheinungsjahr

2009

Link zum Volltext

Quelle

EBSCOhost Business Source Ultimate

Beschreibungen/Notizen

• The late hipster Richard Farina's '60s novel comes to mind when describing the M&A outlook for the rest of the year. "It's going to be a flip-flop," says John Doyle II, managing director and founder of Peachtree Media Advisors. In his company's drill-down of the digital M&A landscape in the first half of the year, almost every category--even online business services--took a nose dive. The b2b category fell from 24 deals in 1H 2008 to eight in 1H 2009, by Peachtree's count. Lead generation and customer acquisition services dropped from 21 deals to 12. M&A experts tell us not to expect a major turnaround in activity anytime soon, even though the comparables between 2H 2009 and 2H 2008 may make things seem better than they are. When the investment world froze in late 2008, many expected that as start-ups ran out of cash in mid- 2009, cash-rich firms would be sweeping up the bargains. That hasn't come to pass on the whole, says Doyle. "VC companies that reinvested in B, C or D rounds are still kind of resilient in terms of valuation." Many of the smaller companies successfully pared down and were able to raise modest amounts that will get them through the year. "The companies are now tuned up and better capitalized and better focused," Doyle says. "They have a new mandate to survive and thrive." If a company was good enough to get this far without crumbling, its prospects are better for the upturn. "On the other hand, a strategic buyer doesn't want to buy something that is about to go under unless it is so core to what they are trying to do." Investment requires visibility, says Ken Sonenclar, managing director at DeSilva + Phillips. "The economic outlook is still far from clear, and that translates into extreme caution in b2b M&A," says Sonenclar. "Buyers always want as much visibility as possible into future earnings and growth. But it's just too difficult to say with any confidence what the world will look like six months from now. Have we already hit bottom? Maybe. Is another dip possible? Certainly."