18 Jul Distressed M&A: The Party Rolls On
A couple of earlier posts on this blog (here and here) have periodically discussed the state of bankruptcy-related mergers and acquisitions during this Chapter 11 cycle. A post dated July 10 by Reuters’ Alexander Smith suggests that M&A activity – which has been brisk – continues unabated. Smith notes:
There were five bankruptcy-related M&A deals announced during the week [of July 6], including the acquisition of venture-backed public company Nanogen by French investment holding company Financiere Elitech for $25.7 million. So far this year there have been 173 bankruptcy-related deals, the highest level since the same period of 2004 when there were 202. During 2009 the most bankruptcy-related M&A deals have occurred in the industrials sector with 23 percent, followed by the media and entertainment sector with 16 percent. In terms of geography, U.S. targets represent 83 deals or 48 percent of the total of bankruptcy M&A. This is hardly surprising given the speed with which some of the biggest bankruptcies have happened in the U.S. – with a little help from section 363 easing rapid asset sales at GM and Chrysler.
As noted in prior posts, this remains an excellent environment for purchasers with the cash, business vision, and/or creativity to make strategic acquisitions.