Transaction Advisory Services - Ernst & Young - Global

As we near the end of recession, there seems to be an upsurge in business activity and strategic transactions across industries. Sixty-seven percent of strategic growth companies are looking into new markets and product lines for investment. Is it a good time to enter emerging markets? 

Watch our discussion:

• Emerging markets: sow now, reap later
• Strategic transactions: an upward trend
• SGM companies looking at new markets
• Building a global foundation
  
  

Full webcast: 
Finding the silver lining in the global economic slump

A review of how PE created value in nearly 300 European businesses over the last four years could provide some insight into how the industry can build on its success and also overcome the challenges it now faces. Our latest study shows (pdf, 4mb) that these businesses had average annual growth in profits of 15% during PE ownership.

Despite an increasing focus on active cash management by many companies, our annual working capital report for 2009 (pdf, 1.4mb) found that up to US$1 trillion of liquidity may still be tied up in working capital in 2,000 of the largest companies headquartered in the US and Europe.

Goodwill is more susceptible to volatility and write-downs in the current economic environment, which can have significant impact on investor confidence and a company's financial health. Our survey (pdf, 304kb) looks at how transaction values of 709 companies across 21 countries were allocated. It reveals that goodwill accounted for 47% of enterprise value, while clearly-identified intangible assets like brands represented, on average, just 23%.

Divesting has always been an important part of corporate development but in today's economic climate it is absolutely central to corporate strategy. Our study (pdf, 17mb) of over 300 companies reveals that more than 50% of businesses are considering selling assets as part of their response to the downturn. Meanwhile, buyers with cash have a rare opportunity to acquire businesses that would not normally be sold at current valuations.

In the face of the economic downturn many large companies are considering divestments. Liquidity and solvency needs are driving organizations to sell non-core and underperforming businesses. Rigorous portfolio management and deal preparation are critical. Our global webcast discusses these and other issues around divesting in today's tubulent times.

Our Spotlight series focuses on the transaction landscape in India, China, Russia and CIS, Central Eastern Europe and Latin America. Read our analysis of the opportunity sectors and political considerations for each area, as well as the challenges facing anyone looking to do deals in these markets.