After a lost year for mergers and acquisitions, almost one in six European companies is planning a large-scale acquisition in the next 12 months and merger arbitrage specialists – a hedge fund strategy that trades around deal announcements – are set to prosper.

Research by the Boston Consulting Group and UBS Investment Bank showed that 16% of companies in Europe are planning an acquisition of a business with sales of more than €500m in the next 12 months. The arbitrage players are already well into the game.