Corporate Growth Looking Up

This is a survey you will find interest in.

A recent survey by Thomson Financial and ACG of 1,301 business executives around the world finds increasing optimism about corporate growth prospects.

Ninety-three percent of respondents in the first ACG/Thomson Financial Corporate Growth Outlook Survey expect their company’s revenues to increase in 2004. Organic growth through investment in sales and marketing, and mergers and acquisitions were each cited by 31% of respondents as the best strategies to achieve growth in 2004, followed by investments in product development (15%), and strategic alliances (11%). Business executives say the greatest external catalyst for corporate growth in 2004 would be an improving economy (49%), followed by a strong M&A market (27%).

Respondents say the sectors that will experience the most organic growth are healthcare, life sciences and medical equipment and services (39%), followed by technology (22%), business services (13%), and manufacturing and distribution (12%). Within technology, they predict the sectors that will experience the greatest organic growth are wireless and telecom (29%), followed by biotechnology (26%), information technology (20%), and software (11%).

Today’s M&A environment was characterized by 45% of respondents as good or excellent, 46% say it is fair, and 8% characterize it as poor. Eighty-five percent of respondents think the M&A environment will improve in 2004, 90% predict the number of transactions will increase, and 67% think valuations of companies will increase. During 2004, the sectors that will experience the most M&A activity will be technology (30%), manufacturing and distribution (20%), and healthcare, life sciences and medical equipment and services (17%), according to respondents.

Business executives say the primary goal of a merger or acquisition today is to grow market share (44%), followed by increase revenues (27%). The company attribute that matters most to an acquirer today is sales and revenue growth (24%), followed by profitability (22%), being in an attractive business sector (16%), management strength (15%), proprietary technology (12%), and a strong brand/corporate reputation (9%).

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