“Although progress was made on many fronts in the first quarter of 2009, many acquirers determined that it was best to sit on the sidelines due to tight credit markets and the high levels of economic and market uncertainty,” says a new article by Mike Rosenthal of PCE Investment Bankers, which takes a first look at Q1 2009 M&A transaction data. “Deal activity dropped substantially during 1Q09,” Rosenthal adds. “When compared to transaction level in 4Q08 and 1Q08, the contrast is striking. Compared to 4Q08, transaction levels decreased at all valuation segments except deals with values above $250 million. The most dramatic decrease was in the $50 to $100 million valuation range, which dropped 52.1%. When 1Q09 is compared to 1Q08, deal activity is down at all levels, with the most significant decrease [again] taking place in the $50 to $100 million valuation segment. During this period, the number of transactions dropped by 70.4%.” A complete copy of State of the M&A Markets, First Quarter 2009 Update, is available here.

For another insiders’ take on the M&A landscape, take a look at Is Mergers & Acquisitions Deal-Making Dead, Dying, or Primed for Resuscitation? by Steven M. Levitt and Jaime Carvallo of Park Sutton Advisors in the April 2009 Business Valuation Update™.