We're about to enter the world of mergers and acquisitions. But before we do that, lets take a step back, to get a general feeling for the larger picture, and examine some of the recent trends in the US, in Europe and in Asia. And if we start thinking about what kinds of trends we can observe, and I'll show you in the next couple of slides, there are three trends that I want to point out. First of all, mergers and acquisitions occur in waves. So that means that lots of firms merge at the same time. And that's an interesting observation in it's own right. Why do they merge at the same time? Not entirely clear. Maybe it's a general economic picture that makes it attractive to merge. Maybe it's because people, firms look at other firms to see well now I need to merge because others have merged. So there's a wave going on. It's difficult to say, but it's interesting. Secondly, mergers have increased over time. So the number of mergers in general has increased over time. And thirdly, the overall volume of mergers has gone up in recent years. So they've become more and more valuable. And I hope to convince you of these three facts in the next couple of slides. When we look at three economic areas, we'll look at the U.S. we'll look at Europe, and we'll look at the Asia-Pacific Region. So here just looking at the value, so that's the red line, and looking at the blue lines which are the number, we can see that first of all mergers do seem to occur in waves. So you've got these two spikes both in '96 roughly and in 2006 that seem to suggest there's lots of mergers going on at the same time. And if you look at the value, the overall volume of mergers has gone up in those three decades that we're looking at. Looking at Europe we see that there are two probably slightly less pronounced spikes here in '98 to 2001 and in 2006 to 2008. These are the two spikes in terms of the numbers. In terms of volume there's a very clear spike and the overall value has only slightly increased in Europe. Finally, looking at the Asia-Pacific region, what we can observe here is a general increase in the number of mergers. And a spike in the value here, a smaller spike here but a general increase in the last few decades. So, just to recap, mergers and acquisitions do occur in waves. They have increased over time and they've become more and more valuable. So now you saw that there are some recurring ups and downs with regards to firms' M&A activity, and that there's an overall trend of increasingly more M&A's that are of increasingly higher importance and of higher value. But before we can move on to understanding why firms actually engage in such deals we need to be clear about some important distinctions, in the next video. [BLANK]
