BDO Horizons 2017 – Issue 2

May 2017

In 2017’s second edition of BDO HORIZONS, our M&A professionals review recent trends and
forecast what lies ahead.

BDO's latest conference of the Americas took place in the country where one off the most significant political events of 2016 took place. As our M&A professionals gathered in Miami, we exchanged views with colleagues and clients on the impact of the new President Donald Trump in general and M&A activity in particular. In this issue, we share the results and provide forecasts for 2017.

Since the beginning of 2017 markets have honoured Mr Trump's economic growth plan, with US Indices such as the Dow Jones Industrial Average reaching a new, all-time high. But it becomes clearer as time passes that the separation of powers in the US is still functioning. The Department of Justice has limited President Trump's power several times and it appears that his action plan might not be implemented as fast as he wishes.

Looking back on Q1 2017, we can determine that political uncertainty caused a slowdown in M&A deal-making. This resulted in the weakest quarter since Q1 2013.
Our BDO Heat Chart clarifies that investors postponed deals due to ongoing political and economic uncertainty. The number of potential deals has massively increased during the first quarter. This makes us confident that – assuming no major political or economic surprises take place – some of the held-back deals will go ahead, resulting in a stronger upcoming quarter. But on the other hand we suspect that due to the ongoing political uncertainty, the trend for larger sums being invested in fewer deals may continue.