Our Insights into M&A Trends - Global Dynamics - Q1 2013 ... fileleading Italian logistics provider...
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Our Insights into M&A Trends - Global Dynamics - Q1 2013 supplement
Transcript of Our Insights into M&A Trends - Global Dynamics - Q1 2013 ... fileleading Italian logistics provider...
Our Insights into M&A Trends - Global Dynamics - Q1 2013 supplement
Clifford Chance has been advising on over US$ 35bn of deals in 2013, many of which reflect key global trends. Highlights ofthese deals include:
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2013: The story so far
n Shell's US$ 6.7bn acquisition of LNG assets from Repsol –demonstrates the continued strength of demand for naturalresources assets in high-growth markets
n Aspects of Silver Lake’s US$ 24.4bn bid for Dell – one of anumber of high-value bids by private equity-backed consortia inthe US and one of the top 3 global M&A deals of the year so far
n The €525m sale by Carrefour of its stake in CarrefourIndonesia to CT Corp – a further example of multinationalsfocusing on core business
n Crédit Agricole's sale of Emporiki, Bank of Greece SA toAlpha Bank – a transaction driven by the Eurozone troubles
n The acquisition by Nippon Express of Franco Vago, aleading Italian logistics provider to high-end fashion brands– an example of Asia's ongoing focus on the luxury goodssector and the recent flow of Japanese outbound M&A
n SapuraKencana's US$ 2.9bn acquisition of Seadrill'sSingapore-based tender rigs business – the energy andnatural resources sector continues to perform strongly
n The acquisition of an 80% stake in Spanish manufacturer,Betapack Group, by Spanish private equity firm Mercapital– an indication of some revival of acquisitions activity byEuropean private equity houses
n The sale by Dubai Insurance Group, a diversified financialservices company, of a 41% stake in ONIC Holding to theOman Investment Fund – an example of the continuing trendof divestment in the financial services sector
n Aspects of Pfizer's spin-off of Zoetis, the world's largeststandalone animal health business – continuation of spin-offactivity
“Global statistics for the first quarter of 2013 show that, despite some encouraging signs at the end of last year and theUS mega-deals in February, M&A activity levels remain subdued as a result of continuing worldwide economic and geo-political uncertainty. Nevertheless, many of our clients expect some pick up in the latter part of the year if we see afurther period of reasonable stability and no larger-scale repeats of the recent bail-out of the Cypriot banking sector.
The European M&A market remains weak, with the economic situation and political landscape continuing to negativelyimpact growth prospects in many parts of the continent. Despite this, we are seeing some interest in accessing strongEuropean brands and technologies, as well as some appetite for opportunistic deals where valuations are seen asfavourable. In the US and parts of Asia there have been some positive economic growth indicators and some perceivedstabilisation of the European market means sentiment may be improving. Equity markets in the US and Asia have nowexperienced a year or so of relative stability and appear to be on a broadly upward trajectory. This helps improveboardroom confidence and creates a stronger currency for outbound M&A opportunities. For those anticipating a continuedrise in local stock markets, now is also being seen as a good time to seize domestic opportunities as they becomeavailable. Overall, whilst no one is expecting a surge in M&A activity, the fundamentals for some pick up are in place and,despite the continuing mood of caution, many see prospects for the second half of the year as better than the first.”
Guy NormanM&A Partner
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Global activity levelsActivity falls in Q1 2013, despite several mega-deals
In the first quarter of 2013, Global M&A fell by over 10% as against the same period in 2012 (US$ 405.9bn, down from US$
452.3bn). Activity levels had picked up significantly in Q4 2012, so Q1's total represents a disappointing 45% decrease from the
previous quarter. The general downward trend in activity levels, which started in mid-2011, continues
Activity levels are particularly weak in Asia Pacific (ex Japan), which experienced a 29% fall as compared to the same period in2012. European M&A is also weak (deals totalled US$ 116.1bn, making Q1 the slowest quarter since Q2 2009), althoughinbound investment into Europe remains relatively strong. By contrast, the value of US activity rose by a healthy 34% (US$ 167bnof deals) as compared to the same period last year, due to relatively large deals in the US (although volume of deals was down),and in Africa and the Middle East, the value of M&A activity rose 101% (US$ 18.5bn of deals)
Cross-border M&A accounted for over 35% of all M&A activity in Q1 2013, with deals totalling US$ 142.4bn. We are continuing to
see companies in the stagnating developed economies accessing the high-growth markets, for example outbound investment
from the US into Asia rose significantly on the previous quarter. However overall emerging market M&A fell 17% on the same
period last year, in particular BRIC M&A is weak, 44% down on the same period in 2012
TMT was the most active sector in Q1, buoyed by several significant transactions including Liberty Global's bid for Virgin Media,
and Comcast's acquisition of NBCUniversal Media. Energy, Mining and Utilities also continues to perform strongly, representing
21% of deals (US$ 85.3bn), with the demand to secure gas reserves driving acquisitions
Private equity buyout activity totalled US$ 84.8bn in Q1 2013, the highest quarterly total since Q4 2010. There continue to be
stark regional variations - US buyouts accounted for 70% of global buyout activity, largely driven by two US mega-deal buyouts -
the Heinz and Dell deals. By contrast, the value of buyouts fell by 36% in Europe (US$ 17bn) and by 23% in Asia Pacific (US$
6.1bn) as compared to the previous quarter
So-called 'mega-deals' – deals worth more than US$ 10bn – made up 22% of the total value of global M&A transactions in the
first quarter of 2013, with a total deal value of US$ 87.7bn. Three of the four mega-deals involved US targets – Heinz, Dell and
NBCUniversal Media. The fourth mega-deal was Liberty Global's bid for the UK's Virgin Media
Source: Mergermarket M&A Round-up for Q1 2013, April 2013.
Clifford Chance LLP is a limited liability partnership registered in England
& Wales under number OC323571. Registered office: 10 Upper Bank
Street, London, E14 5JJ. We use the word 'partner' to refer to a
member of Clifford Chance LLP, or an employee or consultant with
equivalent standing and qualifications.
Clifford Chance Global M&A Toolkit
The essential interactive resource for anyone involved in M&A transactions. The Clifford Chance GlobalM&A Toolkit comprises a growing collection of web-based transaction tools and in-depth analysis of themost important market and regulatory developments in M&A regimes across the globe.
Simple and effective. Available 24/7. Easy to access.www.cliffordchance.com/GlobalM&AToolkit
Global M&A Trends: Interactive investment flow maps
Our new interactive maps show current M&A flows into and out of each major investment region of theglobe giving you insights into the latest trends in cross-regional M&A. The maps are easy to use, simpleand effective. Available through the Global M&A Toolkit at
www.cliffordchance.com/GlobalM&ATrends
© Clifford Chance LLP, 2013.
10 Upper Bank Street, London, E14 5JJ
www.cliffordchance.com
GlobalMatthew LaytonT: +44 20 7006 1229E: [email protected]
AfricaKem IhenachoT: +44 20 7006 1348E: [email protected]
Asia PacificRoger DennyT: +852 2826 3443E: [email protected]
AustraliaDanny SimmonsT: +61 28922 8007 E: [email protected]
Central & Eastern EuropeAlex CookT: +420 22255 5212E: [email protected]
ChinaEmma Davies T: +852 2825 8828E: [email protected]
FranceCatherine Astor-VeyresT: +33 14405 5325E: [email protected]
GermanyArndt StengelT: +49 697199 1486E: [email protected]
Latin AmericaAnthony OldfieldT: +1 212 878 3407/+55 113019 6010E: [email protected]
Middle EastGuy NormanT: +971 43620 615E: [email protected]
North AmericaCraig MedwickT: +1 212878 8168E: [email protected]
UKSimon TinklerT: +44 20 7006 1684E: [email protected]
Global M&A team - Key contacts
