Statistics compiled by De Bellas & Co., a leading specialty Investment Banking firm, indicate that 28 staffing businesses were sold or merged in the third quarter of 2002. This brings the total number of staffing deals completed this year to 97, which is 62% higher than last year's nine-month total. Healthcare staffing transactions continue to garner the most buyer interest, however IT staffing companies paced M&A activity in the third quarter with 7 deals completed.

"Buyers are pursuing specific strategies for growth as they target staffing acquisitions, while sellers are concluding that it may be some time before valuation multiples trend significantly higher," commented John Niehaus, a Managing Director of De Bellas & Co. "Other deal drivers include the benefits of consolidating infrastructures, the ability to grow faster with access to more capital, increased opportunities for staff personnel and, in certain cases, highly motivated sellers."

"However, the M&A environment for healthcare staffing companies has been much more active," continued Mr. Niehaus. "In the healthcare sector, buyers seeking to enter this niche are still being aggressive and the outlook for continued growth remains strong. Yet, it should be noted that the recent declines in the stock prices of Cross Country (Nasdaq: CCRN), AMN Healthcare (NYSE: AHS) and Medical Staffing Network (NYSE: MRN) may be a signal that private company valuations will also begin to recede."

The top five public staffing buyers during the third quarter of 2002 accounted for 7 of the 28 publicly announced transactions. These buyers included Vedior NV; ATC Healthcare; Adecco SA (NYSE: ADO); MPS Group; and Hall, Kinion & Associates (Nasdaq: HAKI). Well-capitalized private acquirers also continue to be active in pursuing transactions, accounting for 43% of the staffing industry deals announced in the third quarter. These private buyers include both strategic acquirers with access to capital and the private equity groups.

De Bellas & Co. monitors nationwide consolidation activity to support its Investment Banking specialty as an advisor in all facets of M&A for its Staffing Services clients.