Rise in Mergers Signals Fresh Confidence

Chief execs becoming more bullish about recovery prospects

By Rob Quinn, Newser Staff

Posted Sep 29, 2009 3:00 AM CDT

(Newser) – Mergers and acquisitions activity is still way down from pre-financial crisis levels, but a recent flurry of big deals suggests America's chief executives are regaining confidence in their own businesses. Recent mergers have involved strategic buys by big companies instead of the debt-fueled private equity buys seen a couple of years ago. That bodes well for a strong recovery, analysts tell the New York Times.

"This is sign that things have stabilized,” said a Credit Suisse analyst. “CEOs are beginning to say, ‘If I don’t buy it now, it’s only going to get more expensive.’" The health care and technology sectors have been leading the way in deal-making. "At the end of the day, in tough times, strong companies look to invest in their future," said Xerox's chief executive, who yesterday announced a $6.4 billion deal to buy Affilated Computer Services.

[Images (2)]

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Xerox Corp. announced yesterday that it will buy Affiliated Computer Services Inc. for $6.4 billion in cash and stock. (AP Photo/Douglas Healey, file)

A bronze bull, Wall Street's icon of prosperity, is poised to charge in New York City's financial district. (AP Photo/Mark Lennihan)

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Will you see us move with a lot of acquisitions over this next year? You betcha. Especially if it plays out economically the way that
I think.
- John Chambers,
chief executive of Cisco Systems

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Rise in Mergers Signals Fresh Confidence