Stomach-churning market turbulence has chilled dealmaking this year, as many companies decide they'd rather wait for calmer times before pursuing public listings or executing mergers.
But not everyone is sitting on the sidelines hoping for a return to more normal conditions.
What's happening: In a statement late Monday, Volkswagen said it had decided to press ahead with the initial public offering for its iconic Porsche brand later this month or in early October, "subject to further capital market developments."
Volkswagen first started looking at spinning off a minority stake in the high-performance automaker in February, just as Russia's invasion of Ukraine jolted investors. A leadership shakeup at Volkswagen added to uncertainty over the listing. Oliver Blume took the reins as chief executive of the German auto giant this month after Herbert Diess was ousted from the job in July.
Yet the automaker has opted to stay the course — even if it means it raises less money due to investor jitters.
Reuters has reported the IPO could value Porsche as high as €85 billion ($84.5 billion), and that Volkswagen could raise more than €10.5 billion ($10.4 billion). That would still set it up to be one of Europe's biggest IPOs ever, according to data from Dealogic.
That's not all: CVS announced on Monday that it struck an $8 billion deal to acquire Signify Health, a home health care services company.
"This acquisition will enhance our connection to consumers in the home and enables providers to better address patient needs as we execute our vision to redefine the health care experience," CVS CEO Karen Lynch said in a statement.
Volkswagen's stock in Frankfurt rose more than 3% on Tuesday morning. It's now down 16.5% year-to-date. Shares of CVS are flat in premarket trading. They've shed 3.6% so far in 2022.
Step back: Dealmaking has slowed sharply this year as market sentiment has deteriorated due to recession fears, soaring energy prices in Europe and uncertainty about plans by central banks to slow inflation. The CNN Business Fear & Greed Index is back in "fear" territory after briefly producing a "greed" reading one month ago.
Just 987 IPOs have been priced so far this year, compared to 2,045 at the same point in 2021, according to data from Dealogic provided to Before the Bell. Deal value has dropped by more than 70%.
Mergers and acquisitions have held up slightly better, with about 25,350 on the books compared to 26,985 during the same period last year. But transactions have been much smaller, as many firms have seen their market valuations plunge.
Deal value for mergers is almost $2.8 trillion year-to-date, compared to more than $4 trillion in 2021.
Looking ahead: Dealmaking could tick up as investors and executives return from time off over the summer.
Private equity firms, in particular, are still sitting on a lot of cash they need to deploy, which could prop up merger activity.
So-called "dry powder" among global private equity players reached a record $2.3 trillion in June, according to PwC. That's triple what they had on hand at the beginning of the global financial crisis.
"This growth in capital explains why PE's share of M&A has increased from approximately one-third of total deal value five years ago, to almost half of total deal value today," the consultancy said in a recent report.
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