Dealmaking activity expanded in January, but the rate of growth was slower than in December, according to Mergers & Acquisitions’ M&A Conditions Index (MACI). The composite score dipped to 51.9 from 55.4. The movement is in keeping with seasonal patterns.
Most components of the index registered growth. The component that measures leads for new transactions was especially noteworthy. At 55.4, the Leads score was more than 17 points higher than the 38.2 of the previous January. The component has shown growth for 12 months now, indicating an abundance of potential future transactions. Survey participants have expressed optimism about M&A in 2017, encouraged by the prospect of lower taxes and fewer regulations.
The M&A Business Staffing component dropped to 49.2 from 54.8 the previous month, representing a rare dip into contraction. The component has registered consistent growth almost all months since the MACI launched in September 2014. We will be monitoring the component closely in the coming months to see if the decline persists or is a momentary drop.