No Quarter for Deals

The quarter may have ended with a big acquisition -- the $9 billion purchase of the maker of Absolut vodka -- but the quarter was a horrible one for deal makers.

The dollar volume of mergers and acquisitions worldwide fell 26 percent from the quarter a year ago, according to preliminary data from Thomson Financial.

In the United States, deals slumped 52 percent from a year ago, to $193 billion, the lowest level since the third quarter of 2004. The slump is especially keen in private-equity deals - down 85 percent -- a year after record buyouts by Blackstone Group and Kohlberg Kravis Roberts & Co. was prompting talk of a "golden age" of finance.

The world, of course, has turned 180 degrees since the buyout mania of 2007. Easy credit has given way to debt markets partly paralyzed by fear. With uncertainty still gripping the markets, the slump in deals is certain to continue through the year. Expect only the occasional strategic deal, like Microsoft's effort to acquire Yahoo.

But some are getting ready for the next wave, whenever it should come. Private Equity Hub reports that Kohlberg Kravis has finished raising money for a $17.6 billion buyout fund. (Much of that money, however, has already been committed.)