Monday saw a flurry of merger-and-acquisition activity, giving investment bankers a ray of hope for 2003 following a year of slumping stock valuations, general market volatility and geopolitical woes. Among the firms announcing deals were Raytheon ( RTN), Yahoo! ( YHOO), Coca-Cola Femsa ( KOF), Southern Union ( SUG) and CoorsTek ( CRTK). Despite the fact that economic conditions remain uncertain, analysts said some firms have decided to go ahead with deals anyway amid intense pressure to improve earnings and revenue growth. Yahoo! and Southern both noted that their transactions would boost earnings in the first 12 months. In addition, M&A experts note that more and more firms are finally accepting that valuation multiples will not appreciate meaningfully in the near term, or return to levels seen in the 1990s. "We believe that the M&A environment has stabilized and is perhaps stronger than generally perceived in the public marketplace," said U.S. Bancorp Piper Jaffray in a recent research note. "We have observed a progressive improvement in market conditions during the second half of 2002." Defense firm Raytheon's announcement Monday would appear to back that up -- the company said it has agreed to make its first acquisitions in four years, with the purchase of two privately held companies: Solipsys Corp. and JPS Communications. The deals are intended to strengthen Raytheon's military communications systems. Terms weren't disclosed. Meanwhile, Yahoo said it would acquire the once-highflying Internet company Inktomi for about $235 million in cash, or $1.65 a share. Separately, Coca-Cola Femsa, the largest distributor of Coca-Cola soft drinks in Latin America, agreed to buy Panamerican Beverages for about $2.7 billion, while Southern Union said it and a partner would buy the CMS Panhandle Companies from CMS Energy ( CMS) for $634 million, plus the assumption of debt. Also, chip equipment maker CoorsTek said it would be acquired for more than $220 million by Keystone Holdings -- a private investment group led by top CoorsTek management and other members of the Coors brewing family.