M&A Targets Today: Seeking Deal Certainty in an Uncertain Environment

Following two years of significant activity, the M&A market in 2008 has set up quite differently. In the first quarter of this year, M&A market activity declined more than 51%, year over year. The financing markets, which remain constrained following the deterioration in the credit availability that began last summer, present a meaningful hurdle to the M&A market, with a large backlog of "signed deal" debt remaining on the books of the investment banks that committed to fund bridge financing. Despite federal and regulatory intervention and the ability to insist on terms that are more "lender friendly" than at any point during the recent run in M&A activity, debt financing sources appear reluctant to finance new deals.

Mark Morton co-authored this article with James R. Griffin, a Partner of Fulbright and Jaworski, L.L.P.

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