Auto Merger And Acquisition Market Growing

The automotive merger and acquisition (M&A) sector will continue to power the automotive industry’s transformation, supporting the changes necessary for the short-term restructuring and long-term sustainability, as shown in a report released by PricewaterhouseCoopers.

The document, called “'Drive Value - Automotive M&A Insights 2009” reveals that the transaction market will maintain its key importance, as players are focused on synergies in their efforts to cut costs and increase revenue.

"The current deal environment is showing positive signs and presents a number of opportunities for both strategic and financial buyers who have access to financing," said Paul Elie, PwC US automotive transaction services leader.

"Companies with stronger operating models and cash positions will likely leverage M&A to develop a competitive advantage through the consolidation of scale and expertise," added Paul McCarthy, U.S. automotive strategy leader.

According to the report, the M&A market saw a 286 percent surge from $31.6 billion in 2008 to $ 121.9 billion in 2009. One of the main factors that drove the increase is the fact that the US Treasury injected huge amounts of money in the country’s vehicle production to avoid the collapse of the industry.

"As we look forward, companies are likely to increase their focus on growth and the traditional drivers of M&A -- driving economies of scale, acquiring technology and expanding their geographic and customer base," said Elie.

The report shows that automotive players that target long term success will be active on the deal market during the course of the present year.
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About the author: Andrei Tutu
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In his quest to bring you the most impressive automotive creations, Andrei relies on learning as a superpower. There's quite a bit of room in the garage that is this aficionado's heart, so factory-condition classics and widebody contraptions with turbos poking through the hood can peacefully coexist.
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