Interview: US chemical M&A activity to revive post election

Joseph Chang | ICIS

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NEW YORK (ICIS)–US chemical merger and acquisition (M&A) activity should get a boost following the US presidential and congressional elections, investment bankers said on Tuesday.

“We expect M&A activity to increase next year, particularly in the US, where any uncertainty associated with the election and associated changes in taxation are removed from the equation,” said Telly Zachariades, partner at global investment bank The Valence Group.

“Regardless of who wins the presidency on Tuesday, we are convinced that the global economy is already on the mend and that investment in new hiring, CAPX [capital spending] and M&A will grow significantly in 2013,” he added.

Peter Hall, also partner at The Valence Group, said that “acquirers who have been close to the finish line on a deal in the past couple of months may well have been back-peddling on inking a deal pending the outcome of the election”.
“Once the election is out the way, regardless of the outcome, there will likely be a number of deals that will finally be pushed forward,” he added.

The end of months of political wrangling over the elections will also go a long way in boosting confidence among senior management, said Zachariades.

“M&A activity also depends to a very large degree on CEO/board confidence. The political situation here in the US has resulted in a lot scare-mongering and negativity, which will also recede once the election is over,” he noted.