Merger and acquisition activity could prove a top theme for equities thisyear, says Credit Suisse, with insurance, healthcare, technology and chemicalsamong the sectors that could see deals.
"With many companies having bought their own shares in 2013, 2014 may bemore about buying someone else's," analysts at Credit Suisse say in a note,forecasting that the pick up in M&A could be stronger than many expect.
"We believe that corporates are biased towards investments that have aquicker payback - and this favours M&A rather than organic growth, whichtypically has a longer payback time."
In the IT software and services sector, they "see scope for all of thecompanies with net cash positions to pursue modest M&A opportunities".
Among chemicals, they highlight Arkema and Croda aspotential targets, while in paper and packaging, Mondi is seen as apossible buyer of others.
Telecoms are another sector to watch, according to the bank, which says:"AnAT&T bid for Vodafone would likely trigger a major re-rating ofthe whole sector and open the door for more cross-border M&A deals."
Reuters messaging rm://antonina.vorobyova.thomsonreuters.com@reuters.net
Vodafone (VOD)
Croda International (CRDA)
Mondi (MNDI)
