Deloitte Survey Finds North America Remains Market of Choice for M&A Transactions in 2014

Nearly three-quarters of executives believe the U.S. economy will continue to improve during the first half of 2014, despite expectation of increased regulatory enforcement

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Deloitte

Mar 17, 2014, 07:55 ET

NEW YORK, March 17, 2014 /PRNewswire/ -- According to a new Deloitte poll, 40 percent of business executives surveyed identify North America as the top market to consider for mergers and acquisitions (M&A) in 2014 – the same sentiment among executives who responded to a similar Deloitte survey in July 2013.

Respondents selected North America by a large margin over China (6 percent), Western Europe (5 percent), Latin America (5 percent) and other emerging markets (6 percent). Seventy-three percent of executives surveyed expressed optimism about the U.S. economy for the first half of 2014, which responses show is primarily driven by low inflation that has boosted purchasing power and consumer spending.

"Despite the negative effects of recent bad weather, the U.S. economy is growing and likely to accelerate," said Ira Kalish, chief global economist, Deloitte Touche Tohmatsu Limited. "Growth in consumer income, the job market and improvements in consumer cash flow are large contributors to the rise in consumer spending, which is likely to contribute significantly to the progress of the economy."

Business performance unaffected by increased regulatory enforcement
Favorability for the North American market remains high, even with 44 percent of executive respondents expecting more robust regulatory enforcement in 2014. They expect regulatory enforcement to focus on financial statement fraud (37 percent), corruption (23 percent) and money laundering (16 percent). More than three-quarters of executives surveyed anticipate there will be no impact on financial performance following a federal inquiry.

"It appears that regulatory inquiries have become part of the business environment and organizations are more resilient in responding to them," said David Williams, chief executive officer, Deloitte Financial Advisory Services LLP. "By being more informed about the regulatory landscape, developing strategic plans and collaborating with third-party advisors, executives can better manage increased regulatory scrutiny and minimize its impact on their organization."

About the online poll
More than 2,000 professionals from industries including financial services; consumer and industrial products; technology, media and telecommunications; life sciences and health care; and energy and resources responded to polling questions during a January 23, 2014 webcast, titled "2014 Outlook: Driving Business Growth in a Complicated and Uncertain Economy." Click here to listen to the webcast.

As used in this document, "Deloitte" means Deloitte Financial Advisory Services LLP, a subsidiary of Deloitte LLP. Please see www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting.

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