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Mergers and acquisitions market set for long, slow recovery

3 July 2009

A 40 per cent plunge in global merger & acquisition (M&A) activity for the first six months of 2009 is not unexpected, according to Allens Arthur Robinson (Allens) chairman and co-head of M&A Ewen Crouch.

'It's a dramatically different economic environment than the one dealmakers were operating in at the start of 2008,' said Mr Crouch.

'The extent of the drop-off will surprise no one and the debate now is really about when M&A activity will pick up.'

Figures released by Thomson Reuters today place Allens among the top five law firms worldwide for announced M&A activity for the first six months of the year.

The figures also show announced M&A activity dropped 40.2 per cent globally worldwide in the first six months of 2009, with the US hardest hit with deal volume dropping by just under 50 per cent, while Asia-Pacific deals fell by 28.4 per cent.

'Over the last six months we've been working on global M&A transactions involving organisations such as Rio Tinto and others. These global deals have kept firms such as ours busy but localised M&A activity in Australia, Asia and elsewhere is still very sluggish,' said Mr Crouch.

'We expect a pick-up in M&A activity in the next six months as companies with strong balance sheets target those that continue to struggle because of the downturn.'

Mr Crouch said the next financial year would not bring a swift turnaround in deal activity but more likely a slow and steady increase.

Ends

Note: The nation classification for league tables is based upon the nation of the target headquarters, not the headquarters of the advising law firm. For example, if the target company is a UK company, the deal will be recognised in the UK league tables. If an Australian firm advised on the matter, they will get credit in the UK and worldwide tables but not the Australia/New Zealand tables.

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Notes for editors.

Allens Arthur Robinson has staff in 14 cities and eight countries across the Asia Pacific.