Ah, what might have been. The year closes with the lingering taste of unconsummated deals and tantalising near misses. BHP Billiton waved $39bn at Saskatchewan in a hostile offer for Canada’s PotashCorp but was stymied by an outpouring of Canadian nationalism-cum-regulation; Potash shareholders never got a look-in. Prudential was halfway up the aisle and lighting a cigar when its own investors stepped in to halt its $35bn tilt at AIG’s Asian assets.
Such setbacks hardly mark the end of large-scale mergers and acquisitions, however, even if the lack of deals does help keep extravagant bonus numbers for the bankers under control.
Rather, deals rely on confidence as much as strategic and commercial logic, so the precondition for more activity is a stable macroeconomic outlook. Until European governments can get a firm grip on the problems of sovereign debt, few will want to start courting.