the brit's are coming...wait a minute isn't marconi a european company?..by george i do believe they are.
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.Wednesday March 31, 7:45 pm Eastern Time
Telecom tie-ups lead in 2nd busiest merger quarter ever
By Eric Wahlgren
NEW YORK, March 31 (Reuters) - Led by a flurry of unions in the red-hot telecommunications sector, notably involving European companies, the 1999 first quarter ranked as the second busiest period for corporate marriages worldwide.
A total of $835 billion in mergers and acquisitions were announced in the quarter with Italian conglomerate Olivetti's $77.9 billion hostile bid for Telecom Italia topping the list, Securities Data Co. (SDC) said in a preliminary report. The top three-month period, however, remains the 1998 second quarter, with $901.2 billion in announced deals, according to SDC figures.
In the United States, the first quarter also was the second most active ever with telecom tie-ups contributing heavily to the $415 billion total in declared deals. During last year's second quarter, U.S. merger activity hit a record $681.7 billion.
''It's good news,'' Alan McFarland of investment bank McFarland, Dewey and Co said of the preliminary numbers. ''It will keep the price of cooperatives on New York's Upper East Side high.''
The $65.9-billion bid by Britain's mobile phone company Vodafone Group Plc (quote from Yahoo! UK & Ireland: VOD.L) for U.S. cellular company AirTouch Communications Inc. (NYSE:ATI - news) headed the roster of biggest U.S. deals in the quarter, SDC said. It was followed by cable television operator Comcast Corp.'s (Nasdaq:CMCSA - news) $58.2 billion announced takeover of cable television operator MediaOne Group (NYSE:UMG - news), the SDC said.
The third largest U.S. deal of the quarter was telecom equipment maker Lucent Technologies Inc.'s (NYSE:LU - news) $21.1-billion acquisition of telecom network provider Ascend Communications Inc. (Nasdaq:ASND - news).
This year's heavy M&A activity comes on the heels of a record 1998, when $2.49 trillion in mergers were announced worldwide, up from $1.168 trillion in the previous year.
Deal makers said they expect this year's strong pace to continue, given the rising pressure to consolidate in a bid to cut costs in the oil industry and other sectors. The possibility that the government may eliminate an accounting loophole that allowed companies to write off large chunks of an acquisition's cost may further fuel mega-deals, they said.
The U.S. Securities and Exchange Commission has discussed scrapping the so-called ''pooling of interests'' accounting method for merger deals in 2001.
''I think in 1999 you are going to see an increasing number of transactions,'' said Mark McDade, a partner at PricewaterhouseCoopers. ''It is likely that you will see a pick-up in activity before the clock stops.''
The second quarter could start with a bang with an announcement expected Thursday that Britain's BP Amoco Plc (quote from Yahoo! UK & Ireland: BPA.L) will acquire U.S. oil company Atlantic Richfield Co. (NYSE:ARC - news) for more than $25 billion. Rumors have also surfaced in recent days that Anglo-Dutch food and household products group Unilever Plc/NV (quote from Yahoo! UK & Ireland: ULVR.L) was again eyeing cosmetic maker Revlon Inc. (NYSE:REV - news).
Earlier this month, the New York Times said life science firm Monsanto Co. (NYSE:MTC - news) was in merger talks with chemical company DuPont Co. (NYSE:DD - news), but the companies have declined to comment on the reports.
Market observers say the Dow's race across the 10,000 mark also is bolstering confidence in the U.S. stock market and could spark more blockbuster deals.
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