Corporations may have overspent themselves in 2015 after setting a $4.7 trillion record on corporate mergers.
This year a nasty hangover is setting in — and $400 billion worth of these mergers have already been undone, according to The New York Times. Deals are collapsing due to antitrust concerns, tightened rules on cross-border mergers and buyer's remorse, according to the report, which names the failed $6.3 billion dealings between Staples and Office Depot, the collapsed $35 billion Halliburton-Baker Hughes merger and the doomed $152 billion Pfizer-Allergan agreement.
"You're definitely seeing a hangover from the M&A party from 2015," Aly El Hamamsy, a partner in Cadwalader, Wickersham & Taft's mergers-and-acquisitions group, told The New York Times. "Things will stay interesting for a few months at least."
The rapid failures of these mega-mergers has created a skeptical market about pending deals, putting more focus on negotiations, according to the report. However, it likely won't slow down transactions too much, according to the report. And after a $40 billion day of mega-mergers last month, it seems the healthcare industry may be taking a hair-of-the-dog approach to M&A this year.
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