The KPMG study also shows that there's an optimal level of dealmaking. Companies that do between three and five deals a year fare best, while those that do more than five deals see lower returns, as do those that do fewer than three deals. “Once you go over five, the returns start to drop because you're stressing the organization too much,” Tiemann says. “And less than three, it's a big event, the organization hasn't done it so much.”

Tiemann is upbeat about the outlook for the M&A market this year. After the financial pain endured over the last 15 months, companies are focusing again on how to grow, he says. “We're seeing M&A activity definitely pick up as companies are reaching out and buying a weakened competitor, or seeing this as an opportune time to do transactions.”

Certainly dealmaking took a beating in 2009, with the 2,963 transactions in North America, down 26% from the total in 2008 and off 43% from the peak in 2007, according to mergermarket, an M&A information service. The value of last year's transactions was down 7% from 2008 and almost 50% below the level in 2007, the mergermarket data show.

Abigail Roberts, global editor at mergermarket, says the pickup in activity as 2009 drew to a close is a good omen for 2010. “The last quarter of 2009 was I think by far the strongest quarter, and you saw a real rush of more traditional M&A,” Roberts says, as opposed to the distressed asset sales that predominated earlier in 2009. “As the market stabilizes, things are getting better. Traditional deals are coming back.”

Roberts also noted expectations that initial public offerings will pick up in the first half of this year, in part because private equity firms are eager to unload some portfolio companies, and buyers aren't yet appearing for those properties.

For a look at the role treasurers are likely to play as mergers pick up, see Cashing in Next Wedding Season.