Welcome to the sixth edition of Forging Ahead, covering mergers and acquisitions (M&As) in the global metals industry in 2009. The steep fall in metals deal value, which gathered momentum in 2008, continued into 2009 with total value charting a course which took it back to below levels last seen in 2003. A distinguishing characteristic of this recession, however, has been that the sector has come through it without major bankruptcies. Companies moved swiftly to conserve cash and protect margins. Partly in consequence, the number of M&A deals in 2009 remained high but for much, much smaller sizes.
Metals Deals 2009 reviews deal activity in the metals industry. We analyse the year under review in the context of the preceding three years, and look ahead to the future direction of deal-making in the sector. We also highlight, in a series of deal dialogues throughout the report, some of the critical issues for companies engaging in deal activity within the sector. Drawing on our global experience as an adviser to metals industry M&A players, our commentary addresses all key markets in the sector.
Looking ahead, the outlook for deal activity is mixed. There is likely to be a continuing contrast between activity in the fast growing economies such as India, China and Brazil and that in North America and Europe where companies will want to be more certain that any upturn is sustainable. Also in the mix is balance sheet health within the sector and this may spur some early upturn M&A moves as companies pursue the logic of consolidation in what remains a fragmented industry.
Global Metals Leader