当前的经济事件将如何影响M&A?

The dramatic failures of Silicon Valley Bank and 签名的银行 remind us that the banking and investment environment is intertwined with the overall economy. Repercussions affect more than bank customers and stockholders. So, 到底发生了什么, 以及潜在买家可能受到的影响, 卖家, 投资者, 或其他涉及未来的人&一个交易?

乔·赫尔曼，主持人 交易摘要播客, spoke with Anna Sabiston, Senior Vice President at 保诚私人资本, about current economic events and their implications for M&一个投资. A 上一位播客嘉宾, Sabiston is based in Minneapolis and oversees her firm’s senior debt, 次级债务, and mezzanine investments across a wide range of companies throughout Minnesota, 爱荷华州, 和南达科他州.

Her conversation with 乔·赫尔曼 is deep and detailed, so you will want to listen to the entire podcast to understand the whole story. 以下是一些关键要点.

为什么经济新闻会影响M&A?

“It was a pretty acute shock to the financial system,” notes Sabiston. “Financing markets essentially dried up overnight for at least a week, even longer for very high-quality investment grade public issuers. 当你在M&一个市场, 不确定性和融资成本, as well as the ability to even obtain financing can have a pretty material impact on a process.”

不确定性一直影响着M&A because it impacts capital markets and the rates that are available. Higher interest rates make the debt to purchase a company more expensive and the payments associated with financing will go up. 这会影响买家愿意提供的价格.

资源: 销售企业指南

发生了什么事?

刺激经济增长, the Fed [Federal Reserve System] set short-term interest rates at near zero from 2009 through 2016. They also adopted a strategy called quantitative easing, purchasing mortgages and longer-term bonds. 当新冠疫情导致经济瘫痪时, the Fed responded by reducing rates and simultaneously boosting the money supply by buying more assets. The Fed’s balance sheet went from showing less than $1 trillion in assets in 2008 to almost $9 trillion during the pandemic.

When the money supply grows faster than the economy, 就会出现通货膨胀. Asset price inflation increased the value of equity, 企业, 房地产, 而其他资产的借贷成本则有所下降. Low-interest rates encouraged 投资者 to choose riskier investments in alternatives, 风险资本, 私人股本, 甚至是加密货币和nft.

结果是, early stage companies including those not making money were able to borrow from banks like SVB. Sabiston explains that part of SVB’s business was looking to fund startups “based on a unicorn billion dollar plus enterprise value.”与此同时, increasing prices for consumer goods drove the Consumer Price Index well above the Fed’s target inflation rate of 2%. So the Fed changed course, increasing interest rates in an effort to slow inflation. Higher interest rates and reduced money supply lead to lower asset values and increased focus on less-risky investments. 风险资本开始枯竭. 债券的市场价值下降.

资产和负债不一致

Banks accept customer deposits, recognizing that these funds may be transitory. 银行通过投资这些存款来赚钱, but they must retain a certain portion to pay out any customer withdrawal demands. Most of SVB’s deposits were from 风险资本-based clients and far larger than the Fed’s insurance maximum. New deposits were slowing as 风险资本 became less available. To stay in business, SVB invested in longer-term assets such as fixed-rate bonds. 这导致它们的流动性不足. When Moody’s threatened to downgrade their credit rating, SVB attempted to boost liquidity by selling some of its bonds at a $1.70亿美元损失.

消息传开了, and in a single day customers demanded withdrawals totaling $40 billion, 俄罗斯对外银行全部资产的20%. 签名的银行, heavily invested in cryptocurrencies with uninsured deposits, 遭遇了类似的命运.

M的未来是什么&A?

Better management of risk management, suggests Sabiston. She says there is not one institution or one policy to blame, but rather the fact that interest rates were so low for so long that risk managers became complacent.

银行客户正转向更高质量的产品, larger institutions that generate greater confidence because they are more highly regulated. Sabiston believes we will see more regulation of regional banks. And now that the Fed has spent so much to cover insured deposits at SVB and 签名的银行, 他们需要补充自己的金库. 这可能意味着银行的保险成本更高.

The result will be stricter credit availability and higher borrowing costs.

M&A activity, which was already down significantly in the latter part of 2022, 可能要到2023年晚些时候才会反弹多少. 获得机构的批准将会更加困难, and acceptable amounts may decline as institutions look to reduce their size of hold. 私人股本买家将更为保守. 另一方面, corporate buyers with healthy balance sheets are in a better position because they have no financing risk for M&一个交易.

Sabiston sees two types of companies coming to market–those with very high-quality defensive assets that make them attractive no matter the environment, 还有那些别无选择只能卖掉的人, albeit at decreased valuation and less attractive terms.

萨比斯顿说，请继续关注. 不确定性尚未结束 and we can expect to see more disruptions going forward.