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Foreign Buyers on the Rise
A few months back we put out a Dispatch predicting that a rising proportion of US M&A transactions would be driven by overseas buyers. At the time, Thomson Financial had calculated that offshore buyers accounted for about 20% of all US deals in the 12 months ending in September, 2007.
Now comes more data supporting the trend, this time focusing on our favorite sector, information and communications companies. According to Thomson, in 2006 foreign buyers closed about 13% of IT/telecom sales in the US. In 2007 they closed about 17%, hitting 23% in December.
(FYI, information and communications deals in toto declined about 14% in 2007 versus 2006, or from 1,671 to 1,439 transactions.)
The cheap dollar, credit crunch and an economic slow-down here will continue and deepen this trend. Advice for prospective sellers: find an investment bank with overseas experience.
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