Private mergers and acquisitions will be driven by the unlikeliest of sources in 2012: public governments.

That's the prediction from Torys, as noted in the firm's latest annual report on M&A trends.

Judging by last year, it's worth taking note of the firm's forecasts: In January, 2011, Torys predicted that politics would continue to matter in foreign takeovers of Canadian companies, and that takeover defence tactics would ramp up. Both hunches proved to be true: A proposed takeover of TMX Group Inc. became highly politicized and Mosaid Technologies Inc. fought hard against a hostile takeover.  

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