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Consumer spending could prompt more mergers


U.S. consumers put the brakes on dealmaking in 2010, but may be the accelerator in 2011, according to Bloomberg.

Mergers and acquisitions topped $2 trillion this year, which was the first increase in three years but failed to approach the $4 trillion peak in 2007.

Shoppers could help bring 2011 closer to that total, fueled by a 5.5 percent jump in holiday sales in the United States on purchases of clothing and jewelry. It was the best performance in five years, according to MasterCard Advisors’ SpendingPulse.

Joseph Gromek, CEO of New York-based Warnaco Group Inc., owner of the Calvin Klein and Speedo brands, said a rise in spending will make companies more optimistic to take a risk.

“There will be a very aggressive approach,” Gromek said in an interview with Bloomberg. “The companies that have strong balance sheets with lots of cash on hand will try to be as opportunistic as possible.”

The 1,000 largest companies worldwide, excluding the financial services industries, have amassed more than $3 trillion in cash and equivalents based on their latest filings, according to Bloomberg data.

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