by Piper Jaffray

By almost any measure or source, deal statistics through the second quarter of 2006 point to another active year for M&A transactions. According to Thomson Financial Securities Data Corp., there were 8,935 domestic deals announced during the 12-month period ended Aug. 30, 2006, a 7.5% increase over the 8,313 transactions announced during the 12 months ended Aug. 30, 2005. The aggregate value of deals with reported pricing increased nearly 23% to $1.1 trillion for the 12 months through August 2006, as compared to $928 billion for the 12-month period ended August 2005. There are a number of tangible and anecdotal factors contributing to this trend, including strong business performance, a relatively positive economic environment, strategic buyers aggressively pursuing growth through acquisitions, financial sponsors with substantial untapped funds and a highly available debt market, among others. Private equity firms have played a major role in the acceleration of both deal values and volume over the past few years. According to Buyouts, the total value of completed U.S. LBO transactions has increased substantially in each of the past four years, reaching $198 billion in 2005 after bottoming out at $24 billion in 2001. And with year-to-date activity through June topping $110 billion, 2006 is on pace to exceed last year’s totals.

Read the entire report here