Europeans missing the US trick
European financial institutions could be missing out by shying away from M&A activity in the US. The strength of the euro against the dollar favours the acquisition of US businesses by European financial institutions. However, according to M&A advisers Berkshire Capital Securities, European institutions continue to look primarily to domestic markets for investment management transaction opportunities. Last year there were just 12 deals involving European buyers into the US, and interest has not increased so far this year.
"If you look at it from a long-term perspective, I'd agree that European financial institutions are missing a trick at the moment," says Glenna Webster, managing director at Berkshire. "They can buy relatively cheaply and there are plenty of very good US businesses that are either going through a generational shift or are looking to expand their own client base into Europe. There are always companies looking for partners and there are plenty of good US firms that are good for a European partnership."
A cautious mood
Webster believes that the investment management M&A mood is cautious at the moment. "It's never easy putting two firms together, because of cultural and business differences, and people are more cautious than ever at the moment because of the markets," she says.