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U.S. BUCK GLOBAL CROSS-BORDER M&A TRENDS

 NEW YORK, Nov. 1 /PRNewswire/ -- The sale of U.S. companies to foreign-owned corporations increased markedly for the first three quarters of 1993 compared to the same period last year.
 During the first nine months of this year, foreign companies spent an estimated $12.6 billion toward the purchase of U.S.-owned operations. The total is $3.6 billion above 1992 levels and represents a 39 percent increase. Meanwhile, the purchase of foreign-owned operations by U.S. companies decreased by nearly two percent.
 According to Stephen Blum, KPMG's U.S. National Director of Corporate Finance, at least three factors contributed to the growth of inbound U.S. investment:
 -- The strengthening U.S. economy, which has attracted foreign buyers interested in optimizing their returns on investment
 -- A favorable interest rate environment in the U.S., which has enabled foreign investors to borrow U.S. funds inexpensively at historically low rates
 -- A secular trend toward cross-border equity partnerships involving at least one U.S. firm
 The increase in U.S. activity is particularly striking in light of the overall global drop in cross-border deals. During the first three quarters of 1993, the European recession and economic uncertainty in many key countries contributed to a 28 percent drop (in dollar volume) in worldwide cross-border M&A activity, according to KPMG Corporate Finance. "Many of the fundamental rationales for buying and selling still exist," says Blum, "but the global economic climate probably needs to improve before worldwide M&A activity can reach last year's levels."
 "The really big cross-border deals have not materialized this year and the worldwide economic climate is not yet right to change the situation either," says Blum. A year ago, KPMG tracked 1,367 deals globally for the first three quarters of the year, with an aggregate value of $57.4 billion. The same period for 1993 produced 1,133 deals worth an estimated $40.9 billion.
 A specific factor contributing to the global performance decline is the recessionary environment in France and Germany, both very significant players in cross-border activity last year. This has forced companies to take a cautious approach to overseas investment.
 KMPG is the world's largest professional services firm with more than $6 billion in annual revenues. The Global Leader in providing accounting and consulting services, KPMG has more than 6,000 partners and 70,000 professionals serving clients through 1,100 offices in 800 cities across 125 countries. In the U.S., KPMG partners and professionals deliver a wide range of value-added assurance, tax, international, and performance improvement services to clients doing business in the following markets: financial services; manufacturing, retailing, and distribution; health care and life sciences; information and communications; government services; higher education, research & other not-for-profits; energy; and personal financial planning.
 -0- 11/1/93
 /CONTACT: Kevin Kelly of KPMG, 212-909-5108/


CO: KPMG Peat Marwick ST: New York IN: SU:

MP-RW -- NY027 -- 9054 11/01/93 10:29 EST
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Publication:PR Newswire
Date:Nov 1, 1993
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