7th Annual Brunswick Group M&A Survey

FOR THE SEVENTH CONSECUTIVE YEAR, the Brunswick Group M&A Survey has polled leading deal
practitioners on their outlook for the coming year’s deal landscape and trends.This is the second year soliciting
European advisors’views and the third with insights from Greater China.Over 160 top deal bankers and lawyers
participated in this year’s global survey: 92 from North America, 33 from Europe and 43 from Greater China.
EXECUTIVE SUMMARY
• Confidence in the global M&A landscape remains high with North America-based, Greater
China-based and Europe-based advisors expecting deal activity in their local region to increase in
2014 (83%, 74% and 72% respectively). Confidence among dealmakers in Europe and Greater
China has improved since last year, up by 11% and 7% respectively.
• Global M&A activity is also predicted to increase over 2013 by North American and Greater
China based advisors (78% and 77% respectively).
• North American and European advisors see this uptick being driven by strong CEO and Board
confidence (63% and 75%, respectively, see this as the key driver), while Greater China-based
advisors see growing appetite for foreign expansion among privately-owned Chinese companies
(53%) and Chinese State Owned Enterprises (50%) as the top factors.

The results of the survey are released ahead of the 26th Annual Tulane University Law School
Corporate Law Institute, the leading M&A conference in the U.S. that draws lawyers, bankers,
Delaware judges, proxy solicitors and other members of the deal community.
For further information: http://www.brunswickgroup.com/publications/surveys/
• In terms of the direction of deal activity, North American advisors expect inbound investment to primarily come
fromAsia (58%) and Europe (36%,up from 23% last year).Meanwhile,European advisors are anticipating an in-flow
of M&A investment from NorthAmerica (72%, up from 61% last year), while China advisors expect acquisitions by
Chinese companies to be targeted towards Europe (46%) & Africa (27%).
• The rise of shareholder activism is set to continue, with two thirds of advisors or more expecting to see an increase
in the level of deal interference by shareholder activists in 2014 (88% in Europe, 69% in NorthAmerica and 64% in
Greater China).Advisors in Europe and North America predict that shareholder activists are most likely to demand
spinoffs, sales or divestitures (52% and 39% respectively).
• Almost all advisors in NorthAmerica, Greater China and Europe expect anti-trust scrutiny for cross border deals
to stay the same or increase across all regions tested in 2014.

1A
Compared to 2013, do you expect the level of North American M&A will increase,
decrease or stay at the same level in 2014?
Confidence in deal activity remains high, almost all of those surveyed believe North American
M&A volume will either increase (83%) or stay the same (15%) this year.
201220112010 2013 2014
DecreaseStay the sameIncrease
2%
10%
42%
48%
3%
97%
0
15%
83%
8%
22%
78%
92%
00

1B
Compared to 2013, do you expect the level of Greater China M&A will increase,
decrease or stay at the same level in 2014?
Nearly three quaters (74%) of advisors survyed in China think M&A in Greater China will increase in
2014, up from 67% in 2013.
76%
20%
4%
67%
30%
4%
74%
26%
0
2012 2013 2014

1C
Compared to 2013, do you expect the level of European M&A will increase, decrease
or stay at the same level in 2014?
Almost three quarters (72%) of Europe-based advisors expect the level of European M&A to
increase in 2014.This percentage has increased from 61% in 2013.
2013 2014
61%
33%
6%
72%
24%
3%

2A
Compared to 2013, do you expect the level of global M&A will increase, decrease or
stay at the same level in 2014?
Nearly four in five (78%) North America-based advisors expect to see increased global M&A
activity in 2014.This is fairly consistent with 2013 views (82%).
2012
2013
2014
78%
82%
49% 28% 23%
15%
19% 4%
3%

2B
Compared to 2013, do you expect the level of global M&A will increase, decrease or
stay at the same level in 2014?
Three in four (77%) Greater China-based advisors expect to see an increase in the level of
global activity in 2014, only 3% expect a global decline.
2012
2013
2014
77%
74%
56% 36%
22%
20% 3%
4%
4%

3
Compared to 2013, do you think the level of mega-deals and leveraged buyouts will
increase, decrease or stay at the same level in 2014?
Increase
Stay the same
20%
71%
Decrease
8%
Seven in ten (71%) NorthAmerican advisors expect to see an uptick in the level of mega-deals
and leveraged buyouts in 2014, down from 89% in 2013.

4
Compared to 2013, do you expect the level of North American corporate spinoffs and
divestitures will increase, decrease or stay at the same level in 2014?
Three in five North American advisors (60%) see corporate spinoffs and divestitures in North
America increasing in 2014, while 36% see the level staying the same and 5% see a decrease in
2014.
5%
Decrease
36%
Stay the same
60%
Increase

5A
North American dealmakers predict a mergers and acquisitions surge this year, propelled mainly by greater confidence
among CEOs and board members (63%). Shareholder activism and pressure from investors (47%) and greater availability
of credit and the low interest rate environment (46%) are also thought to be key factors.
What are the key factors that will drive M&A in 2014?
46%45%63%
16%6%16%
63%64%61%
CEO / Board confidence
47%44%28%
Shareholder activism / pressure from investors
Availability of credit and low interest rate environment
40%53%70%
Improving economy
25%30%20%
Equity market rebound in U.S.
Cost cutting / synergies
32%N/AN/AStrategic repositioning (new lines of business, geographic expansion)
4%8%0
Other
22%36%63%
More cash on balance sheets

5B
Greater China-based deal advisors see the primary drivers of increased M&A in 2014 as a growing appetite among
privately-owned Chinese companies (53%) and Chinese State Owned Enterprises (50%) for foreign expansion.
17%44%28%
20%45%63%
23%45%63%
Opportunities in strugglingWestern economies
50%45%63%
Growing appetite among Chinese SOEs for outward expansion
53%38%84%
Growing appetite among privately-owned Chinese companies for outward expansion
23%53%70%
Improving economy
10%30%20%
3%6%16%
23%N/AN/AStrategic repositioning (new lines of business, geographic expansion)
13%8%0
Other
27%36%63%
30%64%61%

5C
Increased confidence among CEOs and board members (75%) is seen as the primary driver of increased European M&A
in 2014 followed by the improving economy (54%) and greater availability of credit and the low interest rate environment
(50%).
50%56%
7%50%
75%72%
25%28%
54%17%
11%30%
29%N/AStrategic repositioning (new lines of business, geographic expansion)
017%
27%39%
Improving economy
Other

6A
What type of deals do you expect to drive the North American M&A market in 2014?
Domestic transactions among strategic buyers (72%) are expected to make up the majority of
the NorthAmerican M&A market in 2014.
– foreign acquirers
into the U.S.
Inbound Outbound
– U.S. acquirers
outside of the U.S.
6% 6%
Domestic transactions
among strategic buyers Private equity
72% 15%

6B
What type of deals do you expect to drive the Greater China M&A market in 2014?
Nearly three in four (73%) China-based advisors expect the Greater China deal market to be driven by Chinese
companies pursuing foreign opportunities, while domestic transactions (10%) and private equities (10%) are expected
to play a smaller role in 2014.
into the China
Inbound Outbound
– Chinese acquirers
outside of the China
73%3%
among strategic buyers 10% Private equity
10%
Other
3%

6C
What type of deals do you expect to drive the European M&A market in 2014?
More than half (56%) of Europe-based advisors surveyed believe the European M&A market will be comprised of
foreign acquirers pursuing opportunities in Europe, while 19% expect private equity and 15% see European companies
pursing foreign opportunities to be key factors.
into the U.S.
Inbound Outbound
– U.S. acquirers
outside of the U.S.
15%56%
among strategic buyers Private equity
11% 19%

7A
What sectors do you anticipate are the most ripe for consolidation in 2014?
North American deal makers predict the most active sectors for consolidation in 2014 will be
Healthcare (73%) andTechnology and telecoms (70%)
Automotive 14% 1%
Consumer Goods / Retail 31% 41%
Energy 10% 43%
Financial Services 10% 17%
Healthcare 14% 73%
Industry / Engineering 5% 11%
Media 0 15%
Metals / Mining 2% 11%
Utilities 2% 4%
Technology & Telecoms 22% 70%
Other 2% 1%
2013 2014

7B
TheTechnology and telecoms (67%) and Healthcare (57%) sectors are thought to be most ripe
for consolidation in Greater China in 2014.
Automotive 0 10%
Consumer Goods / Retail 16% 33%
Energy 8% 20%
Healthcare 0 57%
Industry / Engineering 0 20%
Media 0 13%
Metals / Mining 0 20%
Utilities 0 0
Other 8% 0
2013 2014

7C
Europe-based advisors believe the Technology and telecoms sector (60%) is ripest for
consolidation in 2014, followed by the financial services (40%) sector.
Automotive 12% 4%
Consumer Goods / Retail 0 36%
Energy 24% 36%
Healthcare 14% 36%
Industry / Engineering 18% 28%
Media 0 12%
Metals / Mining 6% 12%
Utilities 6% 28%
Other 0 4%
2013 2014

8
What sectors do you anticipate will receive the most antitrust scrutiny related to merger
activity in 2014?
The sectors North American advisors anticipate will receive the most antitrust scrutiny related to
merger activity in 2014 areTechnology and telecoms (77%) and Media (61%).
28%
Consumer Goods / Retail
28%
Energy
61%
Media
9%
Metals / Mining
77%
Technology &Telecoms
39%
Healthcare

9A
What region do you anticipate foreign acquirers into NorthAmerica coming from in 2014?
Asia is expected to continue to be the principle foreign buyer in North America (58%). North
American advisors expect more European buyers to be active in 2014 (36%, up from 23%), while only
3% expect buyers to be from Latin America (down from 11% in 2013)
A
sia
58%
Au
strala
sia
1%
M
iddleE
ast
1%
E
urope
36%
L
atinA
m
erica
3%

9B
What region do you anticipate the most foreign acquirers into Greater China coming from in 2014?
For Greater China based advisors, NorthAmerica is expected to remain the top buyer in Greater China
(57%). More respondents expect foreign acquirers to come from Europe and (21%, up from 12%) and
fewer buyers fromAustralasia (11%, down from 19%) in 2014.
Au
stralas
ia
11%
Nort
h
America
57%
Lati
n
Ameri
ca
4%
Afri
ca
4%
Mid
dleEast
4%
Euro
pe
21%

9C
What region do you anticipate the most foreign acquirers into Europe coming from in 2014?
Most Europe-based advisors believe foreign acquirers are most likely to come from North America
(72%) in 2014, an uptick from 61% in 2013.
Nort
h
America
72%
A
sia
28%

10
Compared to 2013, do you expect the number of North American companies re-domiciling to other
countries as part of cross-border transactions will increase, decrease or stay the same in 2014?
North American advisors say the number of North American companies re-domiciling to other
countries as part of cross-border transactions will increase (45%) or stay the same (41%) in 2014.
13%
Decrease
41%
Stay the same
45%
Increase

11
Compared to 2013, do you expect the level of public deals in Germany to:
Two in three (64%) Europe-based advisors expect the level of public deals in Germany to stay
the same as it was in 2013.
4%
Decrease
64%
Stay the same
32%
Increase

12
What impact, if any, do you think the political tension in the Asia region (e.g. between China and
Japan) will have on intra-Asian deal activity in 2014?
Political tension in the Asia region is not expected to have a significant impact on intra-Asian deal activity in
2014,with half (46%) of Greater China advisors predicting a minor reduction in deal activity and almost as many
(43%) anticipating no impact at all.
11%
64%
43%
Major reduction
in deal activity
Minor reduction
in deal activity
None

13A
In 2014, do you expect the level of antitrust scrutiny for cross-border deals in the
following regions to increase, decrease, or stay the same?
Almost all respondents in North America expect anti-trust scrutiny for cross border deals to stay the same or
increase across all regions tested. More than twice as many expect the level of antitrust scrutiny for cross-border
deals in NorthAmerica and Europe to stay the same (NA: 66%, EU: 71%) than think it will increase (NA: 31%,
EU: 29%) in 2014. Advisors are divided on whether scrutiny will increase (50%) or stay the same (50%) in
Greater China.
DecreaseIncreaseStay the same
3%
ChinaEuropeNorth America
66%
31%
71%
29%
50%
50%

13B
In 2014, do you expect the level of antitrust scrutiny for cross-border deals to
increase/ decrease/ stay the same
Almost all respondents in Greater China expect anti-trust scrutiny for cross border deals to stay the same or
increase across all regions tested. Antitrust scrutiny for cross border deals is expected to increase in Greater
China (67%) and North America (57%).
3%
ChinaEurope
10%
North America
40%
57%
57%
43%
23%
67%

13C
In 2014, do you expect the level of antitrust scrutiny for cross-border deals to
increase/ decrease/ stay the same
European-based advisors tend to think anti-trust scrutiny for cross border deals is most likely to stay at the same
level in 2014 in the regions tested, especially in North America (84%).
4% 4%
ChinaEuropeNorth America
84%
16%
64%
32%
56%
40%

14A
Do you expect to see more deals using:
For the first time in five years,advisors in NorthAmerica expect to see a decrease in the number of deals
done with all cash (25%). More than half of respondents (58%) predict that deals will use a mix of cash
and stock although there is also an expected uptick in the number using all stock (17%).
17%
3%
35%
63%
27%
69%
5%
25%
58%
38%
66%
28%
6%
57%
5%
201220112010 2013 2014
All cash A mix of cash and stockAll stock

14B
There has been a reversal in views on the structure of funding for deals in 2014 with almost two in three
(63%) advisors in Greater China believing they will see more deals using a mix of cash and stock, than
using all cash (37%).
2013 2014
42%
58%
0
63%
37%
0

14C
Advisors in Europe expect to see a decrease in the number of deals being done with all cash (38%) and
growth in deals using a mix of cash and stock (58%) or all stock (4%).
2013 2014
22%
78%
0
58%
38%
4%

15A
Deal interference by shareholder activists is a trend expected to continue in 2014 with almost all North
American advisors predicting that shareholder activism will increase (69%) or stay the same (27%).
Given the rise in activist attacks on deals in 2013,do you expect the level of deal interference
by shareholder activists to increase, decrease, or stay the same in 2014?
Decrease
4%
Stay the same
27%
Increase
69%

15B
Nearly two in three (64%) Greater China advisors expect deal interference by shareholder activists to
increase in 2014. Only 4% believe shareholder activism will decrease.
Decrease
4%
Stay the same
32%
Increase
64%

15C
The vast majority of advisors based in Europe anticipate an increase (88%) in deal interference by
shareholder activists in 2014.The remainder (13%) think the level of activist attacks on deals will stay
at the same level as 2013.
Decrease
0
Stay the same
13%
Increase
86%

16A
Compared to 2013, do you expect the number of companies to adopt a poison pill as a
defense tool will increase, decrease or stay the same in 2014?
One in five (21%) NorthAmerican advisors predict the number of companies adopting a poison pill
as a defensive tactic will increase in 2014.
Decrease
8%
Increase
71%
Stay the same
21%

16B
Compared to 2013, do you expect the number of companies to adopt a poison pill as a
defense tool will increase, decrease or stay the same in 2014?
Almost four in five (78%) Europe-based advisors believe the number of companies that adopt a
poison pill as a defence tactic will stay the same in 2014, while 13% think the number will increase.
Decrease
9%
Increase
78%
Stay the same
13%

17A
What do you expect will be the most recurring demand among shareholder activists in 2014?
North American advisors think shareholder activists are most likely to demand spinoffs, sales or
divestitures (39%) in 2014.
39%
32%
27%
3%
Board
representation
Spinoffs, sales or
divestitures
Mergers and
acquisitions
Share buybacks
or dividends

17B
What do you expect will be the most recurring demand among shareholder activists in 2014?
Half (52%) of Europe-based advisors think shareholder activists will demand spinoffs, sales or
divestitures in 2014.
52%
30%
9%
Spinoffs, sales or
divestitures
Mergers and
acquisitions
9%
Board
representation
Share buybacks
or dividends

18
Do you expect companies will agree to put shareholder activists on their boards in order
to avoid public fights in the year ahead?
Nine in ten (91%) North American advisors believe 2014 will mark the year that companies agree to
put shareholder activists on their boards to avoid public fights.
Yes
No
91%
9%

19
What region do you anticipate Greater China acquirers will be buying into most during
2014?
Greater China advisors surveyed believe Greater China acquirers are most likely to invest in Europe
(46%) or Africa (27%) in 2014.
Aust
ralasia
15%
Lat
inAm
erica
4%
Afric
a
27%
Mid
dleEast
8%Europ
e
46%

20 When you are representing a seller of an asset, are there some countries from which you
are more nervous about the buyer?Which ones?
Greater China deal advisors are most nervous about buyers located in Latin America (75%) and
Mainland China (67%).
Other (outside Asia) 8%
Indonesia 38%
Australasia 50%
North America 33%
Latin America 75%
Malaysia 13%
Middle East 17%
Europe 8%
4%Hong Kong
Mainland China 67%
0Singapore
0Japan
0Other (Asia)
0Africa
0Russia
0India

ABOUT BRUNSWICK GROUP LLC
Brunswick Group is a private partnership with a growing team of more than 700 people, including over
100 partners around the world.The firm has grown organically since it was established in 1987 and
currently has 22 wholly owned offices in 13 countries. Brunswick is the global leader in financial and
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affect reputation, valuation and business success. The firm's service offer comprises corporate and
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Brunswick operates offices inAbu Dhabi, Beijing, Berlin, Brussels, Dallas, Dubai, Frankfurt, Hong Kong,
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7th Annual Brunswick Group M&A Survey

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