Black Enterprise – Merger and acquisition specialists, including corporate executives, bankers, lawyers and advisers, differ sharply in their attitudes toward hedge fund involvement in deals, according to a new survey by IntraLinks, a business information technology provider.
Some 427 M&A professionals participated in the study, which focused on Europe. While over two-thirds of the British respondents said hedge funds have a positive impact in boosting deal flow, some of the participants in other countries see adverse effects.
Around a quarter of the French, German and Italian respondents said hedge funds have a negative effect, such as causing share prices to become inflated as a deal is being negotiated.
“Prices are to some extent being driven to unnatural heights due to purely speculative intentions, which makes it more difficult for a strategic investor to conclude a successful deal,” a German investment banker is quoted as saying in the report.
