Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Kiwi firms engage in positive Merger & Acquisition deals

13th March 2014

Market confidence on the rise as Kiwi firms engage in positive Merger & Acquisition (M&A) deals

The current merger and acquisitions climate is seeing plenty of ‘positive’ deals to drive company growth and expansion, according to KPMG New Zealand’s latest M&A Predictor.

The good news story for New Zealand continues – with the latest M&A Predictor figures showing both rising capacity and confidence.

Tony McNaught, KPMG NZ’s Head of Mergers and Acquisitions, says the market is active and buoyant.

“The kind of deals we’re now seeing in the marketplace can be characterised as positive deals. Companies are making proactive, growth-based decisions – they’re seeking out opportunities for enhanced earnings and performance.”

This is a very different picture from the M&A climate a few years ago, says McNaught.

“We’re seeing fewer deals being done because the banks have stepped in, or because poor profitability has left firms cash-strapped. It’s certainly a different beat from the more negative drivers for M&A activity we have seen over the last few years.”

The future climate has different implications for business owners, depending whether they are looking to acquire or divest.

“For business owners who are thinking of selling, this latest M&A Predictor indicates there are currently a healthy number of buyers in the market,” explains McNaught.

“On the other side, if you’re looking to grow by acquisition, you’re going to have a decent amount of competition. And based on the latest forward multiples, the price you’re likely to pay is on the rise.”

KPMG New Zealand’s March 2014 M&A Predictor found:

• The outlook for M&A activity in New Zealand remains ‘very positive’ for the next 12 months.
• Market confidence is up 12% since June 2013, with capacity expected to be up 8% by December 2014.
• Confidence levels across the Asia Pacific region, including Australia and China, have increased markedly since mid 2013.
• New Zealand’s Initial Public Offering (IPO) activity during 2013 was at a 10-year high, with 10 new listings. IPO activity during 2014 is also expected to be strong.

About KPMG’s M&A Predictor
The Predictor is a forward-looking tool, published every six months, that helps our clients consider trends and expectations in merger and acquisition (M&A) activity. By tracking important analyst indicators up to 12 months forward, it examines the appetite and capacity for M&A deals. The rise or fall of forward price to earnings (P/E) ratios offers a good guide to overall market confidence, while net debt to EBITDA (earnings before tax, depreciation and amortisation) ratios help gauge the capacity of NZ firms to fund future acquisitions.

KMPG International also releases a Global M&A Predictor twice a year which provides a similar analysis by sector and country across the globe.

About KPMG New Zealand
KPMG is focused on fuelling New Zealand’s prosperity. We believe by helping New Zealand’s enterprises succeed, the public sector do better and our communities grow, that our country will succeed and prosper.

KPMG is one of New Zealand’s leading professional services firms, specialising in Audit, Tax and Advisory services. We have 825 professionals who work with a wide range of New Zealand enterprises – from privately owned businesses, to publicly listed companies, government organisations, and not-for-profit bodies. We have offices in Auckland, Wellington, Christchurch, Hamilton, Tauranga and Timaru.

Globally, KPMG operates in 155 countries; employing more than 155,000 people in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative (”KPMG International”), a Swiss entity. Each KPMG firm is a legally distinct and separate entity and describes itself as such.

ENDS

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Prefu Roundup: Forecasts Revised, Surplus Intact

The National government heads into the election with its Budget surplus target broadly intact, delivering a set of economic and fiscal forecasts marginally revised from May to reflect weaker commodity prices and a lower tax take. More>>

ALSO:

Convention Centre: Major New SkyCity Hotel And Laneway For Auckland

Today SKYCITY Entertainment Group Limited revealed plans to build a new hotel and pedestrian laneway of bars, restaurants and boutique shopping on land it owns in the Nelson and Hobson Streets block, expanding the SKYCITY Entertainment Precinct. More>>

ALSO:

Igniting The Spark: Bringing The Digital Enabler To Life

Changing a name is, relatively speaking, the easy part of a re-invention. Changing a culture, getting all the ducks in a row, turning yourself inside-out to become customer-inspired is a much bigger challenge. More>>

ALSO:

Ebola And NZ: Targeted Screening At Airport But Risk Low

The risk of any cases of Ebola in New Zealand remains very low, but health and border authorities are well prepared... anyone arriving in New Zealand who in the last three weeks has visited countries affected will be screened for symptoms of the disease. More>>

ALSO:

Scoop Business: Brewer Seeking Crowd-Funding Cancels Shareholders’ Dividends

Shareholders in Renaissance Brewing company, the first business to seek equity through crowd-funding in New Zealand, have cancelled their claim on $147,000 of accumulated earnings “to make Renaissance a more attractive investment opportunity.” More>>

ALSO:

It's Spark Now:
Why Telecom Wanted To Change

New Zealand led the world when Chorus demerged from Telecom. It gave us a telecommunications industry structure where the network is completely separated from the products and services it delivers. The changes brought about a new market dynamic and it dramatically changed Telecom’s role. More>>

ALSO:

Glass Half Empty: Dairy Prices Fall To Lowest Since 2012

Dairy product prices slumped to the lowest level since October 2012 in the latest GlobalDairyTrade auction, paced by whole milk powder and cheddar. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news