After Twitter agreed to Elon Musk's $44 billion offer to buy the company and take it private, many on Wall Street and beyond are asking, 'What's next?'. Is Musk's landmark deal just the beginning of a tidal wave of M&A activity?
Chris Versace, co-portfolio manager of Action Alerts PLUS, explored the future of the merger landscape and what it could mean for the banks behind the deals.
"It will be interesting to see if the typical game of "musical chairs" that arises whenever we see a mega deal like this occur. If that proves out, we could see other potential pairings be announced before too long, which would also spur M&A and advisory fees for investment banks," Versace wrote in a
FULL VIDEO TRANSCRIPT BELOW:
Chris Versace: But let's remember too that typically when we see such a high-profile transaction like this, it tends to result in what I like to call a game of musical chairs, meaning that other folks are kind of assessing potential M&A transactions. Typically, you don't want to be the last person standing in a game of musical chairs. Same goes for potential M&A activity here.
But if we do see a pickup in that type of M&A activity, again, something we've historically seen at times like this, that should benefit the investment banking business in general. And again, we continue to see Morgan Stanley benefiting.