While M&A activity has been mostly lackluster, this has not been the case in the pharma industry. The major players are trying to reposition themselves for changes in regulations, as well as patent expirations of mega drugs.

So, today we got another deal: Watson Pharmaceuticals (NYSE: WPI) agreed to purchase Arrow Group for $1.75 billion. The transaction will be paid in cash and stock.

The year 2008 saw a slew of discount M & A (mergers and acquisitions) deals, most of them below book value. Among these were Wachovia and National City. Capital One Financial bought Chevy Chase Bank at .64 times book value.

If you look at the financial landscape for 2009, some names are already popping up for distressed sales, such as Citizens Republic Bancorp (NASDAQ:CRBC), Huntington Bancorp (NASDAQ:HBAN), Midwest South Financial (NASDAQ:TSFG) and Colonial Banc Group (NYSE:CNB).

It seems that we will see a continuation of the purging of bad bank assets in 2009. Banks use a practice of good/bad assets and move their worst assets to a separate company that absorbs the assets' future losses. Then the original bank emerges as a healthier, deleveraged institution.

All of this is taking place under the radar and it is difficult for investors and the public to know which banks are using this practice. When deleveraging becomes unmanageable, the federal government may need to step in and absorb a bank losses to avoid the bank's failure.

Do you believe the financials are a place to invest in 2009?

Deloitte LLP, which is over 100 years old, has built a wealth of knowledge. In fact, last year the firm posted $9.85 billion in revenues.

Well, Deloitte has put together an interesting series of small pieces – called Straight Talk guides. The goal is to help companies "rely less on guesses."

The guide that caught my attention was "M&A Lies, and Why They're Sometimes True." It's a quick read but has some valuable insights.

Keep in mind that – according to various studies – roughly half of M&A deals fail. That's certainly daunting.

But, this doesn't mean that companies should forgo deals. Rather, many companies have been particularly good at M&A, such as Cisco (NASDAQ: CSCO).

Some of the pieces of Deloitte's advice include:

• Don't get caught up in deal fever. After all, investment bankers can push hard (and they are incentivized to do so). Thus, if you detect some serious problems, slow things down – and perhaps even walk from the deal.
• Buying a company is fairly straight forward; integration, on the other hand, can be extremely complex. In other words, as you are putting together the deal, make sure you are also planning for the post-sale activities. Actually, one of the biggest issues is forgetting about customers (one study shows that customer neglect can result in a 50% drop-off in revenues after four years).
• You need to make sure you see good deals. To this end, it's important to cultivate relationships with various players, such as deal attorneys, CPAs and investment bankers.
• Taxes matter. Can you find ways to lower the tax burden?

So, to get the ebook, you can go to the Deloitte site.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.