5th Annual

M&A Survey

For the fifth consecutive year, the Brunswick Group M&A Survey has polled leading North American M&A bankers and lawyers on their views about the current deal landscape and trends. Over 100 top deal advisors responded to the 2012 poll. This years survey finds: 2012 North American deal flow is expected to be on par or better than 2011. Nearly half of top bankers and lawyers predict an increase over last year, while 42 percent expect deal flow to stay the same as last year. Global M&A volume is forecasted to be steady (77 percent predict flow will be steady or will increase this year) with the strongest activity in Brazil and China. Asian buyers are expected to drive inbound U.S. transactions a view that has grown steadily over the past five years. When asked about the impact that public scrutiny of the private equity industry may have, three out of four dealmakers predict that PE firms will see higher taxes on carried interest.

The results of the survey are released ahead of the 24th Annual Tulane University Law School Corporate Law Institute, the leading M&A conference in the U.S. that draws lawyers, bankers, Delaware judges, proxy solicitors and other members of the deal community. For further information: www.brunswickgroup.com/insights-analysis/surveys.aspx

ABOUT BRUNSWICK GROUP LLC Brunswick Group LLC is a private partnership with a growing team of nearly 500 employees, including more than 80 partners around the world. The firm has grown organically over 20 years and now has 19 wholly owned offices in 11 countries. These include Abu Dhabi, Beijing, Berlin, Brussels, Dallas/Fort Worth, Dubai, Frankfurt, Hong Kong, Johannesburg, London, Milan, Munich, New York, Paris, San Francisco, Shanghai, Stockholm, Vienna and Washington D.C. The firms service offer comprises corporate and financial communications, investor relations, internal communications and opinion research. Brunswick was ranked #1 in terms of deal value according to the Mergermarket global league table for M&A communications advisers for 2011.

1. COMPARED TO 2011, DO YOU EXPECT THE LEVEL OF NORTH AMERICAN M&A WILL INCREASE, DECREASE OR STAY THE SAME LEVEL IN 2012?

Increase

42%

48%

Stay the same

10%

Decrease

2. COMPARED TO 2011, DO YOU EXPECT THE LEVEL OF GLOBAL M&A WILL INCREASE, DECREASE OR STAY THE SAME LEVEL IN 2012?

Stay the same 28% 49%

Increase

23% Decrease

3. WHAT ARE THE KEY FACTORS THAT WILL DRIVE M&A IN 2012?

80% 70% 60% 50% 40% 30% 20% 10% 0%

70%

63%

61%

28%

25%

20%

15%

13%

Sh pre areho ssu lde re f r a rom ctiv inv ism / est ors

M b ore ava alanc cash ilab e sh on ility eet of c s / red it

NOTE: Percentages do not total 100% due to multiple response options. Respondents were asked to select their top 3 options.

Asked to rate the top three drivers of M&A activity in 2012, dealmakers cite economic conditions, cash on balance sheets and CEO or board confidence as key factors.

O stru pport gg uni ecoling W ties in nom est ies ern

Cro

Em cuttiphasi ng s on ben / syn cost efit ergy s

CEO con / Bo fide ard nce

ss-b

Equ it rec y mar ove ket ry

Ec con onom diti ic ons

ord

er d

eal

4. WHAT TYPE OF DEALS DO YOU EXPECT TO DRIVE THE M&A MARKET IN 2012?

Domestic transactions among strategic buyers Inbound foreign acquirers into the U.S. Outbound U.S. acquirers outside of the U.S. Domestic private equity

80% 52% 33% 29% 3%

0% 10% 20% 30% 40% 50% 60% 70% 80%

Sovereign wealth funds

NOTE: Percentages do not total 100% due to multiple response options. Respondents were asked to select their top 2 options.

5. WHAT REGION DO YOU ANTICIPATE FOREIGN ACQUIRERS COMING FROM IN 2012?

Europe 17%

Asia 78% Middle East 1% Latin America 4%

For the fifth consecutive year, advisors expect that Asian buyers will be most active in the North American deal market.

6. OTHER THAN THE U.S., WHAT COUNTRIES WILL BE THE BUSIEST THIS YEAR FOR M&A?

Canada 46%

Germany 19%

Russia 11%

UK 29%

China 65%

Brazil 69%

Australia 32%
NOTE: Percentages do not total 100% due to multiple response options. Respondents were asked to select their top 3 options.

7. WHAT SECTORS DO YOU ANTICIPATE ARE MOST RIPE FOR CONSOLIDATION IN 2012?

Energy Mining / natural resources Healthcare Technology Financial services Industrials Consumer goods / retail Telecoms Media Utilities

55% 53% 51% 47% 40% 26% 20% 4% 4% 3%

0% 10% 20% 30% 40% 50% 60%

NOTE: Percentages do not total 100% due to multiple response options. Respondents were asked to select their top 3 options.

The most active sectors for deal activity, according to the poll, will be energy, mining/natural resources, technology and healthcare.

8. DO YOU EXPECT THERE WILL BE AN INCREASE IN HOSTILE ACTIVITY IN 2012?

Yes 50% No

12%

Same as 2011 38%

9. WHAT IMPACT WILL THE PUBLIC SCRUTINY OF THE PRIVATE EQUITY INDUSTRY HAVE ON DEAL FLOW? IT WILL:

Increase it

3% Decrease it 15%

82% Have no impact

10. WHAT IMPACT WILL THE PUBLIC SCRUTINY OF THE PRIVATE EQUITY INDUSTRY HAVE ON THE TAXATION OF CARRIED INTEREST?

It will likely result in higher tax rates 76%

24%

It wont have any impact

11. DO YOU EXPECT TO SEE MORE DEALS USING:

A mix of cash and stock 35%

All cash 63% 2% All stock

12. WHAT IMPACT DO YOU THINK THE UNCERTAINTY OVER EUROPES SOVEREIGN DEBT CRISIS WILL HAVE ON M&A?

8% 8% 12%

Buyers will be wary to pursue transactions in the E.U. E.U. sellers will look outside the E.U. for buyers

51% 21%

E.U. companies will invest / acquire outside of the E.U. No impact Other

Half of respondents expect the European sovereign debt crisis will significantly dampen buyers interest in European transactions.

13. LOOKING AT THE REGULATORY AND POLITICAL ENVIRONMENTS OF THE U.S. AND CHINA, IS IT EASIER TO DO A DEAL WHERE A U.S. ACQUIRER IS GOING INTO CHINA OR A CHINESE ACQUIRER IS COMING INTO THE U.S.?

Both have challenges

U.S. acquirer is going into China

18% 38%

44%
Chinese acquirer is coming into the U.S.

Advisors polled in the study note that successfully completing cross-border transactions means navigating regulatory, political and cross-cultural challenges.

A selection of charts from the Brunswick China M&A Survey

WHAT REGION DO YOU ANTICIPATE FOREIGN ACQUISITIONS BY CHINESE COMPANIES COMING FROM IN 2012?

Europe 61%

US 17%

Africa 17% Australia 4%

IN WHAT SECTOR IN GREATER CHINA DO YOU EXPECT TO SEE THE GREATEST AMOUNT OF CONSOLIDATION IN 2012?

Consumer goods / retail Energy Property Manufacturing Healthcare Raw / industrial materials Financial services

22% 22% 17% 13% 13% 9% 4%

0% 5% 10% 15% 20% 25%

LOOKING AT THE REGULATORY AND POLITICAL ENVIRONMENTS OF THE U.S. AND CHINA, IS IT EASIER TO DO A DEAL WHERE A U.S.ACQUIRER IS COMING INTO CHINA OR A CHINESE ACQUIRER IS GOING INTO THE U.S.?

25%

Chinese acquirer is going into the U.S.

75%

U.S. acquirer is going into China

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