MIDDLE MARKET M&A FORECAST FOR 2011-2012

A survey of North American CEOs revealed that 67% anticipate a significant increase in M&A activity for 2011-2012.  Such increased activity over the next two years will be impacted by the following factors:

1. Baby Boomers - Making up 25% of the population, Baby Boomers will drive middle market M&A because they comprise the majority of current business owners, who will be looking to sell their business as part of a retirement strategy.

2. Selling of Non-Core Business Units - It is anticipated that corporations will sell their non-core business units in order to concentrate necessary capital on core business units.

3. PEGs Selling Portfolio Companies - Over the next two years, Private Equity Groups are expected to sell their portfoloio companies as many funds are approaching their sunset dates.

These factors, combined with a positive economic outlook, indicate that middle market M&A activity will be robust over the next 2-year period.