Value of Mergers Plummets 50% in First Half of ’90

NEW YORK —  Merger activity fell sharply in the first half of the year as the takeover business continued to contract because of the scarcity of financing, according to statistics released Wednesday.

Securities Data Corp., a financial research firm, reported 2,110 transactions involving U.S. firms worth a total $88.2 billion during the first six months to date, down 50% in value from the 2,420 deals worth $193 billion in the first half of 1989.

The figures reflect not only less activity but also lower prices for companies. Since the collapse of the junk bond market last fall, money to finance deals has been harder to come by, and prices for businesses have consequently declined.

The first-half total includes Philip Morris Cos.’ planned purchase of the Swiss candy maker Jacobs Suchard for $3.8 billion.

Securities Data reported that global merger activity was also down during the first half. The company reported 3,736 transactions with a total value of $187.7 billion, down 39%, from 4,330 deals worth $305.4 billion a year earlier.

There was, however, a slight increase in cross-border transactions--those involving a foreign company and a U.S. company. Securities Data said cross-border deals rose by 2% to $29 billion from $28.5 billion.

In compiling its figures, Securities Data considered transactions including mergers, acquisitions, spinoffs, share repurchases and self-tenders, minority stake purchases and leveraged recapitalizations.