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.

Highlights from this week’s Thomson Reuters Investment Banking Scorecard:

BERKSHIRE HATHAWAY’S BIGGEST DEAL
Berkshire Hathaway’s $35.9 billion bid for the remaining share capital of Burlington Northern Santa Fe, ranked as the fourth biggest M&A deal this year in the United States and the largest acquisition for Berkshire Hathaway on record.
Since 1980, Berkshire Hathaway and its subsidiaries have announced nearly 200 acquisitions, with 43% of those deals in the industrials sector, 34% in the financials sector and 12% in energy & power.   Just over 90% of the acquisitions announced by Berkshire Hathaway have been based in the United States.

IMS HEALTH IN LARGEST BUYOUT SINCE 2007
IMS Health agreed to be acquired by TPG and the investment board of the Canada Pension Plan for $5.2 billion, marking the largest leveraged buyout in the United States since the $27 billion buyout of Hilton Hotels in July 2007.
Eight investment banks provided financial advisory services to IMS and the private equity consortium, including Evercore Partners which currently ranks fourth for year-to-date M&A in the United States, up from 16th last year at this time.

JAPANESE M&A UP 41% OVER 2008
This week’s $11.3 billion merger of Nippon Oil Corp and Nippon Mining Holdings Inc brings the volume of Japanese target M&A to $90.1 billion for year-to-date 2009, a 41% increase over 2008 levels and one of the few regions to see year-over-year M&A growth.
Merger activity in the Japanese financial sector accounts for 38% of year-to-date activity, followed by high technology and real estate with 17.1% and 13.3% respectively.  Energy & power mergers account for 13.0% of announced volume this year, nearly three times last year’s total.

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:

Maybe it’s time to add a new weapon to the old M&A arsenal of poison pills, dawn raids, and white knights — the corporate blog. You could call it the WordPress Hug.

Late on Monday, Cisco’s Ned Hooper used the company’s blog to insist it had offered “a very good price” for Tandberg, after some shareholders of the Norwegian videoconferencing company said the price was too low. (See his full post here.)

The “Driving Conversations” blog of General Motors Europe has also been a source of news on the long-running (and now abandoned) talks to sell Opel, hosting posts from GM’s chief negotiator, John Smith. (See some of his posts on the topic here.)

So could blogging become a major channel of communication on M&A transactions? Big corporations have enthusiastically adopted it for other uses- for example, “Randy’s Journal”, a Boeing blog, has a following in the industry and among aeroplane enthusiasts.

But it is hard to believe this trend would be welcomed by some financial regulators — like the UK’s Takeover Panel, which banned advertising during takeover battles more than 20 years ago.

Mergers and acquisitions activity may be predicted to increase over the next year but in the short-term it may provide another reason for deals to be postponed. Just ask General Motors.

Other deals news in the media on Thursday:

* An investment company controlled by the Shanghai city government will own a majority stake in a planned Disney theme park that won key government approval this week, the People’s Daily reported on Thursday.

* Scripps Networks (SNI.N) is close to an agreement to acquire a majority stake in the Travel Channel from Cox Communications, the nation’s third-largest cable company, the DealBook blog reported on Wednesday.

* British real estate developer Quintain Estates and Development (QED.L) is set to launch a 180 million pound ($296.5 million) rights issue on Thursday, the Daily Telegraph reported.

* In the latest twist in a takeover battle running since January, Canadian fertilizer maker Agrium Inc (AGU.TO) is planning to make a final offer for CF Industries Holdings Inc (CF.N) on Thursday, the Wall Street Journal said, citing people familiar with the matter.

Deloitte’s Energy and Resources group says M&A in these sectors could return to “pre-recession levels” by 2011. In particular, it says the rise of big state-backed rivals is putting pressure on large mining groups, in much the same way Big Oil came under pressure a decade ago. From the group’s 2010 predictions report:

“During 2009, mining M&A has been led by the junior or mid-level players, which have to consolidate if they want to stay alive and not be swallowed up by the bigger firms. Indeed, many anticipate that the mining sector will continue to consolidate until there are a handful of supermajor firms like there are in oil & gas.

“Large mining companies will increasingly need to buy rivals and subsequently sell off assets to gain synergies if they are to compete with state-owned companies, particularly those from China.

“These conditions mirror those encountered by large oil companies a decade ago, when massive consolidation swept the industry in response to the rise of national oil companies (NOCs) such as Saudi Aramco, Gazprom,Petrobras, and others.”

But what are the deals? Anglo-Xstrata is off (for now), as is BHP-Rio. Maybe it’s just a matter of time. Anyhow, in oil and power the team say:

“Apart from the oil supermajors, consolidation will be likely across sectors. Oil & gas independents will be possible targets for reserve-hungry majors but also potential beneficiaries of portfolio rationalization among larger players.

“Power and utility companies will likely look at M&A activity to bolster their strategic positions, provide access to markets, and to raise cash for capital improvements.”

Get the full report here.

It looks like Kraft CEO Irene Rosenfeld is getting ready to play hardball with her reluctant target, British chocolate maker Cadbury.

Cadbury investor Mario Gabelli will be disappointed in the short term - he wanted a small kiss from Irene after all - but a formal offer from the North American food group sets in motion an 88-day process under UK takeover rules.

That should give Kraft plenty of time to sweeten its offer to something starting with an eight - the 800p per share bar regarded by many as the minimum price needed to tempt Cadbury to the negotiating table.

Kraft is expected to post earnings of 48 cents a share for the third-quarter, up from 44 cents a year earlier, according to analysts’ estimates, and good results are expected to strengthen its hand in the ensuing battle with Cadbury.

It’s time for those high-profile bankers working for Cadbury to start sharpening the defence. It’s backed by the trio that ran last year’s demerger of its U.S. softs drinks business, as I wrote earlier here.

Like SocGen before them, UBS strategists are looking forward to a pickup in M&A next year.

From a note published on Monday:

“We expect 2009 to mark the trough in global M&A transactions and for activity to pick up in 2010 and beyond. For FY2010, globally we expect M&A activity in the region of $2.5-2.7trl, an increase of 15% on current annualised run rate for 2009 and close to levels last seen in mid 2004-05. The biggest driver of an increase in activity is likely to be the increase in risk appetite in equity markets and in the boardroom, a return to earnings growth and profitability by World Inc and a backlog of pending asset disposals.”

“Credit conditions are also supportive and we expect private equity and bank lending to pick up at some point next year.”

“We do think investors can take advantage of the growing interest in M&A as the likelihood of deals gets priced into stocks. The average take-out premium historically has been 30-40%, much of which is earned around the announcement of a deal. Merger arbitrage post bid announcement has earned a levered IRR around of 9% this year.”

“Despite a 27% decline in global M&A activity in 2009, deal volumes in Asia remained strong. At the current run rate, 2009 activity in the region will be up on 2008, taking APAC’s share of global M&A to 25%, from 6% in 1995. A meaningful pick-up in global activity in 2010 will require a rebound from trough deal volumes this year in the Americas and Europe.”

“M&A activity could be especially prevalent in the Financials and Healthcare sector due to the shock of increased regulation affecting their industry dynamics. The Healthcare sector, along with Technology is one of the best placed sectors from a balance sheet point of view too, generating high free cash flow and with limited debt on the balance sheet (or net cash in the case of Tech). Asset disposals at the Industrials and Materials sectors could be a theme if excess capacity pressures intensify.”

Despite a dismal couple of years for M&A, the strategists also say there has been a longer-term shift to a higher “natural rate” of mergers than in previous eras (see graph), as dealmaking benefits from globalisation, deregulation, privatisation and the development of financing markets.

Could buying the undervalued Dutch retailer Ahold, which operates U.S. brands including Stop & Shop, make sense for Tesco?

ING analysts Peter Brockwell and John David Roeg think there is a “compelling strategic logic” for a deal.

The pair say buying Ahold’s established U.S. business would be a way of quickly turning round Tesco’s fledgling, and loss-making, business Fresh & Easy, with Tesco funding a deal with cash, shares and disposals.

A tie-up with Ahold would also make sense for domestic rival Delhaize, although given that Ahold is twice its size, any transaction would have to be a stock-based merger, they add. Most other potential predators lack the necessary financing, a strategic rationale to do a deal, or synergies, the ING team reckons.

From the note:

“Ahold’s substantial undervaluation could trigger a takeover.

“We see three possible scenarios: (1) nothing happens, the undervaluation persists; (2) management tries to reduce the gap through more ambitious growth targets/capital restructuring; or (3) predators could eye Ahold’s quality assets.

“Among potential industry buyers, Tesco is our favourite.

“Tesco should be able to finance a potential €12.8 per share bid. Tesco’s 2011F EPS could rise by an extra 14-20% depending on the net amount of synergies, which we conservatively estimate at £493m. Pretax returns on capital employed (including GW) could increase by 110bp in 2011F to 21.8%, only marginally less than Tesco on a standalone basis.

“The US market is too big for Tesco to ignore, yet any attempt to increase the scale of Fresh & Easy could prove very risky. Ahold should be viewed as a one-off opportunity to acquire an undervalued asset at a low point in the US consumer cycle.”

Royal Bank of Scotland (RBS.L) says its deal with EU regulators and the UK government could include “divestments not initially contemplated” as radical shake-up of the UK bank sector looms in the coming days.

For more on these stories, and all the rest of the latest deal-related news from Reuters, click here.

And here’s some picks from the papers (some external links may require subscriptions):

* Comcast Corp (CMCSA.O) and General Electric Co (GE.N) are closer to a deal to give Comcast a 51 percent stake in NBC Universal and a formal announcement may be made in the coming week, the New York Times says, citing people briefed on the talks.

* German retailer Metro (MEOG.DE) is losing interest in acquiring the stores of Karstadt, the department store unit of insolvent Arcandor (AROG.DE), Frankfurter Allgemeine Sonntagszeitung, a German newspaper says.

* Goldman Sachs (GS.N) is in talks to buy millions of dollars of tax credits from Fannie Mae (FNM.N), but the U.S. Treasury could block the deal, says the Wall Street Journal.

* British real estate developer Quintain Estates and Development (QED.L) says it is considering raising equity, after a report it will raise up to 180 million pounds ($298 million) of fresh funds from the Sunday Times.

* Lebanon may launch a public sale of 25 percent of national carrier Middle East Airlines (MEA) after the world economy improves and a new government backs the plan, the central bank governor told a television.