While M&A professionals expect most of the action in those sectors, they say mining, consumer products and healthcare industries will also be reshaped.
"There could be a lot of consolidation across many sectors as stronger firms capitalize on opportunities arising from the market dislocation," said Craig Coben, the European head of equity capital markets at Merrill Lynch.
European companies have struck $1.328 trillion worth of M&A deals so far this year, a 37 percent decline on last year, according to latest Thomson Reuters data. Next year the volume could come off further.
"In 2009 we will continue to see a significant decrease in M&A volumes," said Paulo Pereira, a London-based partner at boutique investment bank Perella Weinberg, adding that volumes could drop by more than a third.
"If you look at previous cycles, you can have a 50-70 percent decline from the top of the cycle to the bottom," Pereira said. A cycle can take three to four years from peak to trough, he added.
A decline by a third would still leave the value of transactions well above the previous trough of $542.61 billion in 2003, even taking into account the fact that market capitalization tends to grow.
But looking at the number of deals, just over 11,220 have been announced in Europe this year, only slightly above the 10,503 transactions recorded in 2002, the lowest number in the past 10 years.
There are two conditions for M&A activity to pick up: cheaper and more readily available debt, and a reduction in volatility in equity markets, said Ian Hart, co-head of European M&A at Citigroup.
"When the equity market is going up or down by 10 percent or more a week, it's very difficult to price any equity deal," he said.
But dealmakers still predict plenty of work next year.
"The reasons for doing deals are still there ... We expect there to be M&A activity in all sectors," Hart said.
In a poll of European M&A professionals conducted in the first half of August, 36 percent of respondents said financial services would experience the highest levels of M&A in the next 12 months, while 34 percent said it would be in the energy sector.
Telecommunications, media and technology, mining, healthcare and consumer products together got a quarter of the vote, according to the survey by Intralinks, a provider of software for managing M&A documents.
"There is a lot of restructuring in the corporate landscape to be done in Europe that has already happened in the U.S. Whole sectors of the economy in Europe, for example, were only liberalised in late 1990s," Pereira said, adding that energy and telecommunications were clear examples
Twenty years ago, large companies like Deutsche Telekom and Deutsche Post were in state hands and were not active in M&A in any material way, he said.
Mergers and takeovers among financial, energy and healthcare companies have registered the smallest annual declines this year, with drops of 1 percent, 11 percent and 16 percent, respectively, Thomson Reuters data show.
"There will be more (deals) in certain areas, like pharmaceuticals and biotech," said James Buckley, who manages Baring European Growth Trust, a European large-cap fund, adding he was overweight biotechnology stocks.
The forecast for deals in Europe in 2009 may seem like a trickle relative to the record $2 trillion in 2007, but it will keep dealmakers ticking over until the market returns to its glory days.
"We will see a return to those peaks, but not anytime soon -- not in the next five years," Pereira said.
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