The global economic slowdown has resulted in only a minor drop in M&A transactions in the Australian market, according to M&A co-practice leader Ewen Crouch at Allens Arthur Robinson (AAR).

 

Crouch pointed to a Connect 4 survey that shows there was a 20% drop in Australian M&A activity during the first six months of 2008 compared to the same period last year. He said this is encouraging, because many law firms expected a bigger drop.

 

“This reflects a steady M&A market,” said Crouch. “At the start of 2007 the economy was in full swing and M&A activity was at record highs. It’s not surprising then that in a vastly different climate for capital markets, only 40 deals were carried out.”

 

While a number of large deals are keeping AAR busy, Crouch said Texas Pacific Group’s (TPG) recent bid for the Asciano Group could be considered a sign that private equity activity would rebound, but believed M&A work was unlikely to increase dramatically for several months at this stage.

 

“We’re not expecting a booming M&A sector in the next 12 months, but nor do we expect a significant slump in work,” said Crouch.

 

Allens topped Connect 4’s Australian M&A deals table for the first half of 2008, with eight deals worth A$193bn.

 

The firm is currently acting on four of the top 10 deals announced by Connect 4. Crouch says two of them are the highest valued transactions.