The threat of a market slowdown has been at the forefront of M&A industry speculation for the better part of the last 12 months. The topic has populated headlines and has been the focus of discussion across the investment community. However, with the second quarter of 2007 now complete, the question remains: where is the slowdown?

Middle-market transaction activity (defined as transactions with disclosed deal value less than $500 million) is on track to surpass 2006 levels, resulting in what will likely be another record year for M&A activity. During the first half of 2007, there were 6,148 transactions announced, up from 6,105 during the equivalent period in 2006.Further, despite a slight decline in announced first half deal value compared to the first half of 2006, $75 billion in the second quarter of 2007 surpassed the first quarter's total value by 16.4 percent.  Overall, the M&A market in 2007 remains healthy.

Download the complete Market Update — Second Quarter 2007.