Most Canadian execs expect improved economy, dealmaking

EY survey suggests M&A activity will be strong in the year ahead

Most Canadian execs expect improved economy, dealmaking
Steve Randall

Canadian executives are preparing for mergers and acquisitions in the coming 12 months and are optimistic about the economic future.

The EY Global Capital Confidence Barometer reveals that 76% of Canadian executives are planning M&A activity, well above the historic average of 50%.

They are also optimistic about the Canadian economy with 92% expecting improvement, up from 54% just two years ago, and 93% see the global economy improving too.

"A number of factors are supporting corporate confidence and appetite to do deals," says Doug Jenkinson, Partner in EY Canada's Transaction Advisory Services practice. "Canadian executives expect increases in corporate earnings, credit availability and the stock market over the next 12 months. These conditions are setting the stage for growth."

Most execs targeting growth of at least 10%
There’s good news for investors in Canadian companies with more than 78% of the executives targeting revenue growth greater than 10% in the coming year.

They will be investing in technology and digital; and restructuring and improving existing operations; in order to drive growth.

And just 3% of respondents said they are expecting to cut headcount in the year ahead.

"Canadian executives are focused on becoming smarter, stronger and evaluating all aspects of their capital agenda to maximize positive market conditions — while not losing sight of the potential for economic or political setbacks," says Jenkinson. "A decade on from the global financial crisis and those lessons of caution and discipline still remain critical to success."