SEPTEMBER’S EDITORIAL

SEPTEMBER’S EDITORIAL

Uncertainties relating to European states indebtedness and their consequences on the whole financial system already have an impact on the economies of the developed countries and should soon impact developing countries’ economies. Domino effect has begun …

Company’s managers should prepare as of now for credit restrictions. The financial markets, which are a measure of these turbulences, might however come across the interest of issuers and investors again within a few months.

Indeed, if the stock markets regain a little stability, ECM operations should increase especially takeover bids since issuers do have liquidities which will allow bid offers in good pricing conditions. The fact that issuers have already begun buy-back operations on their own shares is a sign that cash is ready to be spent and that prices are low.

Besides, investors have important liquidities too implying that capital increases, bonds issuances and IPO’s will eventually finance issuer’s needs.

Finally, if funding sources were to lack, Mergers and Acquisitions operations realized through non-cash and stock-only operations will become more and more frequent. The financial crisis might then actually promote the emergence of new leaders on the French market, especially in the services/advisory sector where many SME’s experience economic dependency problematic.

Only trust is missing so that this scenario becomes real …

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