Swiss SMEs

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Deloitte 2019 Study: M&A Activity by Swiss SMEs

An uncertain dynamic

In Switzerland, M&A activity was sustained mainly by SMEs and private equity funds.

The total number of transactions in 2018 was similar to 2017, but there was a notable increase in Inbound transactions and a fall in Outbound transactions.

For the first time in more than three years, CFOs’ expectations for the Swiss economy were less optimistic, but still satisfactory.

In spite of a positive economic environment for the Swiss market, the outlook for M&A in 2019 - following an active year in 2018 is subject to uncertainty in the global market environment.

Key points in the 2018 survey:

Outlook for 2019

In an uncertain global economic and political environment, the economic outlook for Switzerland remains positive. . The warning signs are increasing, suggesting that the risks for Swiss SMEs are greater. These risks relate to the escalation of US trade disputes, the aftermath of Brexit within a context of political tensions in Europe, and the future of relations between Switzerland and the European Union based on the Framework Agreement negotiations. Although the 2019 forecasts of the State Secretariat for Economic Affairs (SECO) have been revised downwards, they are still based on a positive scenario for the Swiss economy and normalisation of the growth rate. The uncertainty, even though it did not impact transaction levels in 2018, makes it difficult for companies to see ahead, and this might lead some acquirers to be cautious.

Thus, M&A activity could suffer from the negative signs, although the trend might turn upwards instead in 2019.

About the Deloitte Swiss SMEs Report

The Deloitte report entitled "Swiss SMEs – M&A Activity in 2018" examines merger and acquisition transactions involving Small and Medium-sized Enterprises (SMEs). In order to fall within Deloitte's definition of an SME, companies must meet three main criteria: turnover of more than CHF 10 million; fewer than 250 employees and a market capitalisation between 5 million and 500 million CHF. This edition concerns the period between 1 January and 31 December 2018.

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