Venable partner Chuck Morton was quoted in a November 8, 2012 Law360 article on a spike in year-end deal closures that many attorneys believe could lead to a slow start in 2013. The rush to close deals and record profits is in response to an expected tax hike at the end of year.
Noting the rush has not sparked new but rather moved up deals expected to close early next year, Morton said, “These are transactions that would get done anyway, but now they're getting done earlier, and I don't see a secret stash of deals behind them…I think we're in for a slow spring.” A similar spike in deal closures occurred in 2010 when the Bush tax cuts were set to expire, however a deal to extend them in November meant many closures were pushed off into the next year. We saw this story play out in 2011, but [the dropoff] wasn't as steep because a lot of deals strayed over to the new year,” Morton said. Commenting on the possibility of a deal to avoid the tax hikes, Morton expressed skepticism, saying, “I think people are being overly optimistic that Washington will be able to do something rational.”
Noting the rush has not sparked new but rather moved up deals expected to close early next year, Morton said, “These are transactions that would get done anyway, but now they're getting done earlier, and I don't see a secret stash of deals behind them…I think we're in for a slow spring.” A similar spike in deal closures occurred in 2010 when the Bush tax cuts were set to expire, however a deal to extend them in November meant many closures were pushed off into the next year. We saw this story play out in 2011, but [the dropoff] wasn't as steep because a lot of deals strayed over to the new year,” Morton said. Commenting on the possibility of a deal to avoid the tax hikes, Morton expressed skepticism, saying, “I think people are being overly optimistic that Washington will be able to do something rational.”