A divergence between private equity houses and private equity-backed corporates has emerged and is hampering both exit rates and corporate growth ambitions, which in turn could have consequences for private equity managers’ ability to raise new funds.

M&A; activity in distribution has remained strong despite the economic downturn, principally driven by strategic buyers.

Developed economies are witnessing the return of hostile M&A;, especially in the energy sector. However, the mismatch in value expectations between buyers and sellers continues to slow and complicate transaction processes in all regions and sectors.

There is likely to be an increase in M&A; activity in the technology, media and telecoms sectors over the next two years.

While much of Spain’s banking consolidation has focused on savings banks this year, the country’s medium-sized lenders are about to fuel the next round of M&A; activity, with some players expected to buy the newly-merged savings institutions or merge with each other, according to industry participants.