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Canadian M&As Seen Shrugging Off Market Turbulence: report

Market turbulence won't likely dissuade a wave of Canadian merger and acquisition activity in coming months as private equity funds deploy piles of cash on new investments and seek buyers for their mature assets, experts say, according to a Reuters report.

Reuters said strategic buyers might stimulate further dealmaking as boards and CEOs come under pressure to spend billions in capital saved since the global economic crisis and face limited alternatives for organic growth.

"If credit markets co-operate, we'll see a huge jump in sponsor to sponsor (fund to fund) activity in the next 12 to 24 months," Jim Fasano, a vice-president at the Canada Pension Plan Investment Board, one of the nation's largest pension fund administrators, reportedly said.

The comments, made to a Canadian Venture Capital and Private Equity (CVCA) conference this week, were surprisingly bullish in light of the bleak global economic environment, with the prospects of slowing demand from China and the threat of a new recession in Europe, Reuters said.

According to the report, Fasano estimated huge demand for so-called exit activity, where funds sell their investments or take them public, in 2012, with some $1.5 trillion of assets to monetize globally. "A lot of people are going to be seeking realizations," he reportedly said. "There are some very cash-rich corporates out there with limited prospects for organic growth."

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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