The Capital Confidence Barometer is a regular survey of more than 1,500 senior executives from large companies around the world, which is conducted by the Economist Intelligence Unit on behalf of …
The Capital Confidence Barometer is a regular survey of more than 1,500 senior executives from large companies around the world, which is conducted by the Economist Intelligence Unit on behalf of Ernst & Young. The respondent community comprises an independent EIU panel of senior executives as well as Ernst & Young's clients.
This report from Ernst & Young summarises the results of the February and March 2012 survey, gauges corporate confidence in the economic outlook and identifies boardroom trends and practices in the way companies manage their capital agenda.
Some of the key findings include:
Despite a more favourable deal making environment, only 31% of those surveyed expect to pursue an acquisition in the next 12 months down from 41% in October 2011. In contrast, the number of businesses looking to sell assets has risen from 26% to 31%.
Companies headquartered in India, UK, the US and Germany were among the most bullish, while their counterparts in Japan and Russia were less so. When asked where they will do deals, China, India, the US, Brazil and Indonesia were the top five target markets.
In terms of acquisitions, companies in the financial services, life sciences, oil and gas, technology and consumer products sectors said they were more likely to do deals. Metals and mining, automotive and power and utilities companies are less positive in their M&A outlook.
Almost half of the companies that have re-engaged in M&A or who are at least thinking about it say that they will be using cash as their primary source of funding.