Review of and outlook for mergers and acquisitions in the European financial services market 2006
This report analyses the deals and trends in the financial services sector across Europe in 2005 and provides insight into some of the factors that may shape European Financial Services M&A going forward.
Key findings in our report include:
- 2005 saw deal values increase for the third year running with c. €79 billion of financial services deals announced in the year, an increase of 74% (by value) on 2004;
- In 2005, average deal size surged to €399 million, approximately 50% up on 2003 levels;
- Cross-border deals represented two-thirds of total deals by value (2004:62%)
- Emerging markets experienced a strong increase in activity as international banks began investing in the region. Together, the CEE, Russia and Turkey represented almost 15% of deals (by value), up from 2.5% in 2004; and
- In 2005, four out of the top 10 cross-border deals had a US company as the bidder – in 2004 there were none.
Looking ahead we expect European FS deal activity to continue to increase potentially driven by:
- Domestic consolidation in the Italian banking sector;
- More private equity interest and involvement;
- The search for growth in emerging markets;
- Bolt on acquisitions (possibly large) in the insurance sector;
- Greater M&A involving the infrastructure of European financial services; and
- Regulatory pressure.
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