Although we’ve spent a lot of time fretting over the rout in global commodities and the resulting challenges facing Australia’s economy, the country’s firms are still highly sought after by foreign investors–especially now that the exchange rate is well below its highs during the commodity boom.

While Thomson Reuters reports that this year saw $116 billion in deals, a 16% jump from the prior year and the highest level since 2011, next year could be an even bigger year for M&A.

As long-term investors, we don’t always like it when firms swoop in and acquire Portfolio names, even at a premium, because we not only lose an important stream of income from the dividend, we also miss out on the prospect of future growth that attracted the acquirer in the first place.

And with the downturn in both crude oil and iron ore, there are numerous opportunities for larger firms to buy solid assets on the cheap from troubled companies. Indeed, more than $13 billion worth of deals in the global energy sector were announced in the past week.

Falling commodities, lower share prices, and a decline in the exchange rate combine to make Australian firms tempting targets for foreign companies and investors. So much so, that Merrill Lynch investment banker David Wood told The Australian that he sees “a real need for companies to undertake defense work and be prepared for a potential takeover.”

At the same time, if weakened companies are truly in danger of bankruptcy, we’d prefer a takeover at a premium to depressed share prices over a total wipeout.

According to The Australian, its recent survey of the major investment banks and advisory houses shows that top dealmakers are anticipating another strong year.

While Swiss mining giant Glencore is widely expected to make another bid for Aussie iron miner Rio Tinto Ltd (ASX: RIO, NYSE: RIO), foreign firms aren’t the only ones taking advantage of the current situation.

In fact, Australian energy major Woodside Petroleum (ASX: WPL, OTC: WOPEF) CEO Peter Coleman says the firm has been patiently awaiting this moment for the past three years.

“We’ve been preparing ourselves–our cash commitments are low, and we have a huge amount of optionality in our balance sheet,” Coleman recently said.

Woodside has been facing pressure from investors to deploy its cash hoard on new growth projects. But until recently, the economics didn’t make sense, as the firm’s disciplined management team walked away from two deals earlier this year when they couldn’t reach favorable terms.

But the bear market in crude has changed all that.

Earlier this week, Woodside announced the acquisition of Apache Corp’s Australian Wheatstone liquefied natural gas (LNG) and Balnaves oil interests and Kitimat LNG project interests in Canada, for an aggregate purchase price of USD2.75 billion.

And now that Woodside is in the catbird seat, expect more to come.

“We have taken a disciplined and patient approach to identifying the right growth investment,” Coleman said in the deal’s announcement. “We are now in a position to take advantage of challenging market conditions and use cash reserves and existing debt facilities to acquire very high quality assets.”

In a bear market, cash is king, not only because it offers downside protection, but also because it provides the liquidity necessary to take advantage of market dislocations.