The fallout from the credit crunch has allowed sovereign wealth funds to increase their financial influence across the globe, according to a report from Freeman & Co., a boutique merger and acquisition advisory firm. The report outlines several ways the credit crunch has affected the asset management industry and also recaps merger and acquisition activity during the past year.
Sovereign wealth funds have invested more than $42 billion in global investment banks in the last six months, according to the report.
The report also notes that global REIT returns are down 20% and are trading at 20% below net asset values. The report also said fundraising grew 70% annually for private equity firms and 95% annually for CDO managers leading up to the credit crisis, although both groups face serious contraction now.
In recapping the M&A market for 2007, the report noted there were 213 acquisitions in 2007, involving $1.3 trillion. The greatest growth in deals came for alternative investment firms, which accounted for 77 deals, up 40% from the year before.
