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Manufacturing M&A Slips in 2017, PwC Says

Bill Koenig
By Bill Koenig Senior Editor, SME Media

Merger and acquisition activity involving manufacturing slipped in 2017, consulting firm PwC said in a report.

The year saw 2491 industrial M&A deals, down 1.15% from 2016’s 2520, according to the report. However, the decline in deal value was sharper: $80.8 billion in 2017, down 22% from the year before.

Companies making M&A transactions “pushed through turbulence and uncertainty as they assessed assets around the globe,” PwC said in the report’s summary.

The consulting company said M&A may increase this year after the United States cut its corporate tax rate to 21% from 35%.

The tax cut, PwC said, “has provided the perfect catalyst for increasing M&A activity domestically as well as making the US a more attractive market for other dominant players, including Europe and China.”

Portfolio ‘Realignment’

Large industrial companies “have announced the strategic realignment of their portfolios” which may result in divestitures, according to PwC. The consulting company didn’t identify specific examples.

General Electric Co. (Boston) in November announced a restructuring, saying it would focus on health care, aviation and energy. GE this week reported a $9.8 billion loss for 2017’s fourth quarter. The loss included $6.2 billion in costs related to problems in its finance unit.

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