By Chris Marinac | September 2, 2016
M&A In Early September
- Since 1990, 187 bank merger transactions were announced during the first eight days of September, covering the Labor Day Weekend
- 14 separate years occurred with an M&A deal over $100 million in announced value
Could 2016 be a repeat of past activity? We feel the atmosphere is ripe since stock prices are strong and willingness to sell is high.
Our analysis of several thousand bank industry mergers from 1990 through 2015 signals that early September is historically an active time for merger announcements. Based on our own experience since the early 1990s, coming back from the long holiday weekend has regularly been greeted with fresh merger news between two companies and sometime multiple deals.
In fact, in 17 out of the 26 years we studied, more than one merger was announced on the same day, near Labor Day. We feel investors should take notice of this history because today’s buyers have:
- Strong valuations (equity currency)
- Plentiful cash liquidity
- Positive sentiment – a seller’s willingness to engage in deals has rarely been better
So what’s our recommendation? Rest and relax this weekend, but keep your eye on the news headlines early next week.
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