The Faber Report

Is M&A Ripe for the Picking?


Conditions are ripe for significant mergers and acquisitions activity, "but confidence is the key," Robert Spatt from the firm Simpson Thacher & Barlett told CNBC today.

The Future of M&A

“The credit is there. We keep hearing that there is better credit, more money available than there has been in years and years and years," Spatt said.

"And it’s accompanied by lower rates,” Spatt added, " can borrow money more cheaply, specifically if you are a strategic borrower.”

As a result, there is a growing agreement that things are “clearly getting better.” Spatt said, “we got a good sustained, less volatile market condition."

Takeover Target Stocks

Plus, the high value in the stock market is great for companies doing stock for stock deals because you have a good currency on the buy side and a good currency on the sell side." Spatt said. 

With the pent up demand to do deals, Spatt thinks private equity firms will see more M&A deals in the near future, especially in regard to industry consolidation.

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