Skip to content
Link copied to clipboard

Why so many mergers? 'Lack of growth alternatives'

IPOs down amid 'uncertainty'

The number of U.S. private placements and public stock offerings, to raise capital for growing firms, fell from 200 in the third quarter to just 152 in the last three months of 2015, lowest since mid-2013, writes Janney Montgomery Scott investment banker Benjamin McKean, in a report for the Association for Corporate Growth's Philadelphia chapter.

McKean cited 'the effects of growing market uncertainty" including China demand and Fed interest-rate unknowns. But slow growth won't stall all dealmaking, he added: The "lack of alternative growth opportunities" will press continued corporate consolidations. Indeed, the count of mergers and acquisitions, at 302, was within the quarterly range for 2015 and above 2013-14 levels.

ACG includes private equity investors, venture capitalists, and the lawyers, accountants and other specialists who work on their deals. Philadelphia has one of the group's most active chapters.  See ACG's list of 28 recent deals by local member firms and McKean's note here.