M&A Quarterly Update Q2 18
The Bridgepoint Midwest M&A Index, a measure of corporate merger and acquisition activity in the U.S. Midwest region.
How many times have you been caught off guard when one of the bank’s largest clients calls to give you a heads up that they are selling their business, and your mind probably goes right to the thought, “How am I going to replace this loan volume?”. Followed closely by the thought, “Wow – why didn’t the client ask for my advice or involvement in the process?”
Anyone that’s been through the process of securing capital, making an acquisition or transferring ownership knows how complex, time consuming and frustrating transactions can be. There are many things that can get in the way of a deal closing, like negotiating issues, due diligence surprises, unrealistic valuation expectations, and cultural differences, among others.
Midwest banks have traditionally traded at discounted valuations relative to the broader S&P Financials Sectors Index, but the confluence of the Wells Fargo scandal negatively impacting large banks and the Trump election signaling regulatory relief (more positively buoying smaller banks) have had the effect of eliminating that discount.