Highlights from Thomson Reuters data on mid-market (sub-$500 milion) deals. For October in European, the Middle East and Africa (EMEA):

· Average bid premium four weeks prior to announcement increased on average across sectors in EMEA year to date compared to same period in 2008 by 2% with bid premia rising slightly with half the sector showing an increase and half decreasing.

· Year on year Average Rank Value to EBITDA however decreased by 16% on average with only the Real Estate and Materials sectors increasing.

· JP Morgan top the European Mid-Market M&A rankings YTD, up from third position for same period 2008

· EMEA Mid-Market M&A from January to end of October down 49.6% compared to same period last year, to US$110.2bn from US$218.8bn.

· EMEA Mid-Market M&A activity for October at US$12.2bn, down 12% from September’s US$13.9bn, but down 34.9% compared to October 2008 which stood at US$18.7bn.

Sector coverage:

· EMEA High Technology US$865m for October down 60% from US$2.2bn in October 2008.

· EMEA Media & Entertainment US$165m for October down 86% from US$1.2bn in October 2008.

· EMEA Telecommunications US$219m for October down 79% from US$1.1bn in October 2008

Global Mid-Market deal activity for October at US$46.8bn from 2,864 deals, down 11% from US$52.7bn from 3,207 deals in September but only slightly down compared to same month previous year from US$48.5bn.

Like UBS and Societe Generale, Deutsche Bank’s researchers are now forecasting a resurgence in M&A and say investors should “prepare to ride the wave”.

They concede that “picking actual as opposed to potential M&A targets is a notoriously difficult exercise” but have come up with 30 potential European targets, based on strategic and financial criteria. While bank lending remains a problem, they say that is not always an insurmountable hurdle, and should spur more stock-based deals (see graph below).

In a note dated Nov. 4, the DB team writes:

“Following two years of below-normal levels of merger and acquisition (M&A) activity in Europe, we believe the conditions are in place for deals to return to the fore as a major driver of returns: Public markets are well and truly open for financing, low organic growth should spur expansion by acquisition, rising equity markets and sub-peak valuations make stock an attractive acquisition currency, and confidence is returning to boardrooms and executive offices.”

Here are their 30 top targets:

Most binges are followed by hangovers, and so the takeover boom earlier this decade is likely to translate into some hefty goodwill impairment charges for major European companies, as they mark down the value of assets bought when the party was in full swing.

This graph, lifted from a new report by Houlihan Lokey, shows the proportion of companies in each sector of the DJ Stoxx 600 index that have a book value of equity at least 10% above their market capitalisation. The bigger the dark blue line, the worse shape the sector is in - step forward autos, banks, insurers, other financial institutions, and real estate-companies.

Read the full Reuters story on the report here. And here’s an earlier HL release on U.S. goodwill impairment.

Merger mania is back, at least that’s what the numbers seem to show.

A staggering total of about $60 billion worth of corporate deals have been announced or rumoured in global markets since Saturday alone. The takeover feast is impressive, spread as it is across diverse sectors such as foods, semiconductors, financials and telecoms.

Kraft Foods’s blockbuster $16.7 billion offer to buy Cadbury has suddenly turned the spotlight back to dealmaking and swept away markets’ lingering concerns of patchy economic growth. The rising deal volume is a welcome relief for investment banks, who’ve gone through a torrid year after Lehman’s bankruptcy last September brought M&A to a halt. The dealmaking will help them partly fill their coffers with much-needed advisory fees and a kick up in the league tables.

No doubt with many equity markets rallying to 2009 highs, and lured by prospects of improved valuations, many buyers are chasing deals while prices are seen as cheap. That could have been the thinking behind Abu Dhabi’s move to offer $1.8 billion to buy loss-making Nasdaq-listed, Singapore-based Chartered Semiconductor in a chip sector emerging from its worst downturn.

Many companies are simply being opportunistic, but with the economic tsunami having left so many companies floundering there the opportunity to reel in cost savings and restructuring bargains through mergers could outweigh any lingering caution about whether the recovery is for real or not.

Could the sale of Britain’s biggest electricity distribution network help re-energise infrastructure dealmaking?

The supposedly steady business of buying and running roads, ports, and power grids has had a torrid time. The credit crunch has undermined some big infrastructure players, made it tricky to finance deals, and revealed that demand for some services — like toll roads and airports — is flakier than expected. Asset sales have run aground, instead of commanding the big premiums they would have fetched in the frantic debt-fuelled auctions of yore.

Nonetheless, optimists say the world’s long-term infrastructure needs are enormous. They are also cheered by the record $100 billion or so of funds that Preqin says are currently being raised (albeit slowly). And there may be some chinks of light on the M&A front. As Greg Roumeliotis and I wrote earlier:

“EDF’s possible sale of British or French power networks worth billions of euros suggests infrastructure dealmaking is set to recover after a dismal year for the once-hot asset class.

“The French utility owns Britain’s biggest electricity distribution network and France’s power grid RTE. It has not begun any formal sales process for either, but bankers and investors say advisers are working toward possible sales.

“A successful deal could lift sentiment in the sector, spur similar disposals by rivals, and offer useful pointers on debt availability and bid premiums for infrastructure mergers and acquisitions (M&A).

“The EDF deal is going to be an interesting test case for the market which has been very difficult,” said Martin Nelson-Jones at Freshfields Bruckhaus Deringer in London.”

Read the full story here. See Preqin’s recent report on the sector here.

European bankers may be having more conversations that could lead to M&A than six months ago, but this week’s deal figures from Thomson Reuters still make dismal reading.

So far this year, European M&A has been worth $356.6 billion, a 51% fall compared to last year at this time. Excluding government investments, merger activity in Europe totals $239.1 billion, a 67 percent decrease from 2008 levels.

Here is another of this week’s data points:

“Germany’s E.on has agreed to sell its natural gas distribution subsidiary, Thuega AG, to a group of German utility companies for $4.1 billion, topping the list of worldwide mergers this week. Goldman Sachs, which advised Thuega, and @visory Partners GmbH, which advised the consortium, could share an estimated $30 million to $35 million in advisory fees on completion of the deal.

Thomson Reuters data for July show the so-called “mid-market”, of deals below $500 million, has come off slightly compared to the month before, and steeply compared to the same month a year ago.

Year-to-date, JPMorgan is the busiest bank by dollar value of deals, displacing Credit Suisse, which falls from 1st to 6th. Freshfields overtakes Clifford Chance as the busiest legal outfit. A few highlights from the report:

“Global Mid-Market deal activity for July at US$40.8bn from 2,940 deals, down 6% from US$43.3bn from 3,284 deals in June. Down 42% compared to US$70.2bn from 3,627 deals in July 2008

“EMEA Mid-Market M&A activity for July at US$10.6bn (26% of total global mid-market activity), down 8.5% from June’s US$11.6bn, but down 54% compared to July 2008.

“JP Morgan topped the European Mid-Market M&A rankings, up from second position for the same period in 2008.

“Freshfields Bruckhaus Deringer ranked top legal adviser with 5.2% market share, up from second position for same period 2008″

Nycomed, the Swiss drug company, already has 4 billion euros or so of net debt and some pretty junky single-B credit ratings. But that’s not deterring the private-equity owned outfit from plotting a bid for the drugs business of Belgium’s Solvay, even in these leverage-phobic times. As I wrote earlier:

“Switzerland’s Nycomed plans to draw on buoyant junk bond markets and new cash from its private-equity owners to fund a buyout of Solvay’s drugs unit, people familiar with the matter said.

“Such a structure would allow Nycomed — which already has billions of euros of syndicated loans — to bypass the moribund leveraged loan market and would create a group with some 6 billion euros ($8.6 billion) in yearly sales.”

Nycomed has a few strong cards to play — a track record for integrating acquisitions and quickly paying down debt, owners ready to stump up a billion euros or so of fresh funds, and a solid case for being able to tap both Europe’s recently resurrected junk-bond market and its much larger U.S. counterpart.

And in preferring securities to bank debt, Nycomed is blazing a high-yield trail down a path already well-trodden by investment-grade peers such as Roche, whose buyout of Genentech was underpinned by $30 billion of bonds. Indeed some, including Reuters columnist Alex Smith, sense a “dramatic shift” underway in Europe as bonds fill a vacuum left by vanishing bank loans.

It would be hard to describe July as a banner month for mergers and acquisitions.

Friday’s data from Thomson Reuters shows it was the first month since Sept. 2004 where announced deals totalled less than $100 billion, and the first month in almost six years without a single $5 billion-plus deal. But top executives are starting to talk M&A again, and bankers are starting to lay the groundwork for future deals. As Michael Erman and I wrote earlier:

“Bankers are pointing to early signs of a pick-up in mergers and acquisitions (M&A), with stronger stocks and easier credit conditions helping company bosses regain the confidence to do deals.

“Global announced M&A totaled $968 billion in January to June — little more than 40 percent of pre-crisis volumes in 2007 — and financiers do not expect a sudden return to the hectic dealmaking of the boom years.

“But they say an August holiday lull could be followed by an upswing toward the end of the year, based on more active discussions with clients and in some cases growing pipelines of future deals.”

Full story here. For full details of Deloitte’s recent CFO survey, which we referred to in our piece, click here.

U.S. officials consider giving CIT Group Inc a temporary loan as part of an aid package to help the lender avoid collapse; U.S. asset manager Franklin Resources Inc (BEN.N) drops out of a consortium negotiating to buy American International Group Inc’s (AIG.N) asset management unit; and The New York Times Co agrees to sell its New York City classical music radio station for $45 million, to help pay off debt. For these stories and all the other latest deals news from Reuters, click here.

And here’s what’s in the newspapers and online (some links may require subscriptions):

* Belgium’s Solvay (SOLB.BR) has narrowed the list of bidders for its pharmaceuticals business to Swiss company Nycomed and Abbott Laboratories (ABT.N) of the United States, FT.com reported on its website.

* The board of Australian conglomerate CSR Ltd (CSR.AX) still favours a stock market float of its $955 million-valued sugar business, though four overseas trading houses are eyeing bids if a trade sale goes ahead, Australia’s Age paper reported.

* Two companies controlled by Macau Chief Executive Edmund Ho have sold a combined 1.25 percent stake in financially troubled Air Macau to a unit of China flagship carrier Air China (601111.SS), the South China Morning Post reported, citing sources.

* South Korea’s Samsung Electronics (005930.KS) plans to invest about 500 billion won ($389 million) in the biotech medicine business, a local internet news provider said on Wednesday, quoting a top policymaker.

* Administrators for Lehman Brothers Holdings Inc’s (LEHMQ.PK) main European unit have finalized a plan to return about $13 billion in client funds that have been held up in legal proceedings since the investment bank collapsed last year, the Wall Street Journal said.

* Bank of America Corp (BAC.N) is mounting a campaign to rehire several of the more than three dozen senior Merrill Lynch & Co investment bankers who quit after the firms merged, Bloomberg reported, citing people familiar with the efforts.

* Commodities trading company Glencore International AG has been talking to bankers about selling a small stake in the business to raise $1.5 billion, Wednesday’s edition of the Daily Telegraph newspaper reported.