US M&A News and Trends

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This Issue: US M&A News and Trends U.S. M&A deal activity increased in March, going up 24.7% with U.S. private equity activity increased in March, up 45.7% from 2 US Merger 909 announcements compared to 870 in February. Aggregate M&A February. There were 118 deals in March compared to 81 in spending also increased. In March, 18.8% more was spent on deals February. Aggregate transaction value also increased, up by 42.0% Metrics compared to February. to $28.7 billion from February's $20.2 billion.

2 US Middle Over the past 3 months, the sectors that have seen the biggest The top financial advisors for 2017 based on deal announcements, increases in M&A deal activity, relative to the same three-month are: Goldman Sachs & Co., Citigroup, Morgan Stanley, Barclays Plc, Market Monitor period one year ago, have been: Consumer Durables (76 vs. 51), and JPMorgan Chase & Co. The top five financial advisors, based on Process Industries (106 vs. 100), and Government (7 vs. 6). Three of the aggregate transaction value of the deals worked on, are: 3 US Sector the 21 sectors tracked by FactSet Mergerstat posted relative gains Goldman Sachs & Co., JPMorgan Chase & Co, Morgan Stanley, Bank Activity & Value in deal flow over the last three months compared to the same three of America Merrill Lynch, and Barclays Plc. months one year prior. The top legal advisors for 2017 based on deal announcements, are: 4 US Strategic Over the past 3 months, the sectors that have seen the biggest Kirkland & Ellis LLP, Skadden, Arps, Slate, Meagher & Flom, Jones Buyer Report declines in M&A deal volume, relative to the same three-month Day LP, Latham & Watkins LLP, and Paul, Weiss, Rifkind, Wharton & period one year ago have been: Commercial Services (448 vs. 545), Garrison. The top five legal advisors, based on the aggregate Retail Trade (79 vs. 139), Health Services (135 vs. 184), Finance (368 transaction value of the deals worked on, are: Kirkland & Ellis LLP, 4 US Private Equity vs. 414), and Producer Manufacturing (167 vs. 196). Eighteen of the Cleary Gottlieb Steen & Hamilton LLP, Skadden, Arps, Slate, Report 21 sectors tracked by FactSet Mergerstat posted negative relative Meagher & Flom, Simpson Thacher & Bartlett LLP, and Davis Polk & losses in deal flow over the last three months compared to the Wardwell LLP. 5 Top US Advisors same three months one year prior, for a combined loss of 405 deals.

Topping the list of the largest deals announced in March are: PPG 6 Top US Deals Industries, Inc.'s proposal to acquire Akzo Nobel NV for US$23.8 Scoreboard billion; Intel Corp.'s, agreement to acquire Mobileye NV for US$14.1 billion; Cenovus Energy,Inc. agreeing to acquire the remaining 50% stake not owned in FCCL Partnership from ConocoPhillips for US$13.3 billion; KKR & Co LP and The Caisse de dépôt et placement du Québec agreeing to acquire USI Insurance Services LLC, a portfolio company of Onex Partners, in a deal valued at $4.3 billion; A private group led by SUEZ SA and The Caisse de dépôt et placement du Québec's agreement to acquire GE Water & Process Technologies Co from General Electric Co for in a deal valued at $3.4 billion.

The US Mergers & Acquisitions Market Index

$450.0 1,350 $423.8

$400.0 1,200

$350.0 1,050

$300.0 900

$250.0 750 $210.9 $207.6 $176.9 $200.0 600 $145.2 $154.8 $133.3 $123.1 $116.3 $142.1 $136.9 $150.0 $120.0 $115.3 450 $99.7 $93.7 $103.0 $100.0 300

$50.0 150 1,204 1,172 1,057 1,046 1,021 975 1,053 1,047 1,154 1,113 1,052 1,019 995 1,123 870 909 $0.0 0 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Deal Volume Aggregate Deal Value

US MergerMetrics April 2017

Merger Stats

Number of Deals Agg. Transaction Value ($Bil)

12 Months Ended 12 Months Ended Average Deal Size 3/31/17 3/31/16 Change 3/31/17 3/31/16 Change P/E

$1 Billion + 341 319 6.9% $1,603.0 $1,731.3 -7.4% 34.9

$500M to $999.9M 235 222 5.9% 169.7 153.3 10.8% 26.9

$250M to $499.9M 314 318 -1.3% 110.8 113.9 -2.8% 28.5

$100M to $249.9M 494 575 -14.1% 79.2 90.6 -12.6% 32.1

$50M to $99.9M 377 441 -14.5% 26.9 31.5 -14.6% 21.0

$25M to $49.9M 383 432 -11.3% 13.6 15.6 -13.1% 27.1

$10M to $24.9M 403 605 -33.4% 6.5 9.8 -33.5% 17.0

Under $10M 808 1,008 -19.8% 2.6 3.5 -26.9% 24.4

Undisclosed 8,976 9,881 -9.2% N/A N/A N/A N/A

Total 12,331 13,801 -10.7% $2,012.3 $2,149.6 -6.4% 28.9

M&A at a Glance MEDIAN P/E MEDIAN PREMIUM

30.0x 45.0% 40.0% 25.0x 27.4x 35.0%

20.0x 30.0% 21.3x 33.% 20.4x 25.0% 27.7% 15.0x 20.0% 24.6%

10.0x 15.0% 10.0% 5.0x 5.0%

0.0x 0.0% 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17

US Middle Market Monitor MEDIAN EV/EBITDA MEDIAN PREMIUM

12.0x 60.0%

10.0x 50.0% 10.2x 8.0x 40.0% 7.9x 8.2x 6.0x 30.0% 35.8% 32.8%

4.0x 20.0% 24.3%

2.0x 10.0%

0.0x 0.0% 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17

*Middle Market defined as deals valued between $1 million and $500 million, plus undisclosed deals.

Media: Media quotation with source attribution is encouraged. Reporters requesting additional information or editorial comment should contact [email protected]. Mergerstat gathers its data from sources it considers reliable; however, it does not guarantee the accuracy or completeness of the information provided in this publication. Copyright 2017 FactSet Research Systems Inc. All rights reserved. It is illegal under federal copyright law to reproduce or redistribute this publication or any portion of its contents without written authorization of the publisher.

US Sector Activity & Value April 2017

SECTOR BY ACTIVITY L3M 3/31/17 L3M 3/31/16 Target Sector Deal Count Deal Count Difference Consumer Durables 76 51 25 Process Industries 106 100 6 Government 7 6 1 Industrial Services 119 120 (1) Communications 37 39 (2) Non-Energy Minerals 69 73 (4) Consumer Non-Durables 84 88 (4) Utilities 68 72 (4) Electronic Technology 85 89 (4) Distribution Services 170 177 (7) Consumer Services 215 224 (9) Energy Minerals 36 47 (11) Miscellaneous 12 24 (12) Transportation 45 62 (17) Technology Services 469 492 (23) Health Technology 107 133 (26) Producer Manufacturing 167 196 (29) Finance 368 414 (46) Health Services 135 184 (49) Retail Trade 79 139 (60) Commercial Services 448 545 (97) Total 2,902 3,275 (373)

SECTOR BY VALUE L3M 3/31/17 L3M 3/31/16 Target Sector Value Value Difference Consumer Non-Durables $23,375.7 $5,252.8 $18,122.9 Process Industries 35,850.4 18,227.6 17,622.8 Energy Minerals 21,168.4 3,556.7 17,611.8 Industrial Services 39,970.5 23,364.4 16,606.1 Non-Energy Minerals 17,552.2 3,084.9 14,467.3 Health Services 17,278.5 7,503.6 9,775.0 Consumer Services 21,789.4 16,925.8 4,863.7 Health Technology 20,248.9 15,782.7 4,466.2 Miscellaneous 3,524.7 967.2 2,557.5 Electronic Technology 8,457.3 7,741.5 715.8 Government 0.0 0.0 0.0 Communications 1,959.9 4,075.6 (2,115.8) Consumer Durables 8,045.2 10,326.9 (2,281.7) Finance 37,567.5 40,655.0 (3,087.5) Retail Trade 3,706.7 7,155.0 (3,448.3) Technology Services 23,040.3 27,694.1 (4,653.7) Commercial Services 23,456.3 28,752.8 (5,296.5) Transportation 2,297.8 10,496.5 (8,198.8) Utilities 18,505.4 28,398.2 (9,892.8) Distribution Services 7,704.3 19,217.5 (11,513.2) Producer Manufacturing 19,690.1 34,169.2 (14,479.1) Total $355,189.4 $313,347.8 $41,841.6

US Strategic Buyer Report April 2017

Merger Stats

Number of Deals Agg. Transaction Value ($Bil)

12 Months Ended 12 Months Ended Average Deal Size 3/31/17 3/31/16 Change 3/31/17 3/31/16 Change P/E $1 Billion + 173 178 -2.8% $993.9 $902.0 10.2% 35.3 $500M to $999.9M 136 124 9.7% 97.4 85.3 14.2% 32.4 $250M to $499.9M 186 195 -4.6% 66.4 70.5 -5.8% 24.2 $100M to $249.9M 317 385 -17.7% 51.5 60.4 -14.7% 29.6 $50M to $99.9M 262 316 -17.1% 18.7 22.4 -16.5% 20.2 $25M to $49.9M 280 318 -11.9% 9.8 11.5 -14.5% 27.2 $10M to $24.9M 297 460 -35.4% 4.8 7.5 -35.9% 15.3 Under $10M 534 736 -27.4% 1.7 2.7 -34.3% 17.9 Undisclosed 6,963 7,899 -11.8% N/A N/A N/A N/A Total 9,148 10,611 -13.8% $1,244.3 $1,162.2 7.1% 27.9

PUBLIC BUYER INDEX LTM 3/31/17

$300 360 $281.6 $250 300

$200 240 $142.3 $150 180 $81.9 $92.7 $80.5 $92.3 $100 $49.7 120 $69.9 $52.3 $51.4 $50.6 $67.3 $50 60 297 271 271 275 277 278 288 281 249 320 246 227 $0 0 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17

US Private Equity Report Indices Top Private Equity Fundraisings: YTD 2017

PE BUYER INDEX: LTM 3/31/17 Open Date Value ($Mil) Fund (Private Equity Sponsor) 11-Jan-2017 $3,000.0 New Enterprise Associates 16 LP $35 140 $28.8 $27.1 New Enterprise Associates LLC $30 $24.2 $25.0 120 $21.6 $21.9 $22.9 1-Jan-2017 2,500.0 Marlin Equity V Fund $25 $20.2 100 $20.2 $17.3 Marlin Management Co. LLC $20 $19.1 $15.9 80 $15 60 1-Jan-2017 1,582.1 DIF Infrastructure V Coöperatief UA $10 40 DIF Management Holding BV

$5 126 123 109 111 131 119 113 116 124 106 81 118 20 24-Feb-2017 1,000.0 Vestar Capital Partners VII Fund $0 0 Vestar Capital Partners, Inc. Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 16-Mar-2017 1,000.0 Z Capital Special Situations Fund III

Z Capital Partners LLC (Private Equity) GOING PRIVATE INDEX: LTM 3/31/17 1-Jan-2017 750.0 Marlin Heritage Fund II Marlin Management Co. LLC 15 $14 $12.5 8-Feb-2017 650.0 ENR Partners II Fund $12 Edge Natural Resources LLC $9.3 $8.8 $10 10 3-Jan-2017 505.3 Stabilis Fund V $7.1 $7.1 $7.1 $8 $6.2 $6.4 Stabilis Capital Management LP $6 $3.9 $4.0 $3.4 5 2-Feb-2017 500.0 ICV Partners IV LP $4 $2.1 ICV Partners LLC $2 4 13 8 9 6 4 7 10 4 4 6 7 25-Jan-2017 450.0 Venrock Fund VIII $0 0 Venrock Associates Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17

Top US Advisors April 2017 BASED ON US ANNOUNCED DEALS – RANKED BY TRANSACTION VALUE: YTD 2017 Transaction Total Transaction Total Financial Advisor Value ($Mil)* Deals** Legal Advisor Value ($Mil)* Deals** 1. Goldman Sachs & Co. $125,890.5 48 1. Kirkland & Ellis LLP $67,815.7 70 2. Morgan Stanley 88,896.0 37 2. Skadden, Arps, Slate, Meagher & Flom 65,241.5 44 3. JPMorgan Chase & Co 71,073.3 30 3. Cleary Gottlieb Steen & Hamilton LLP 56,498.4 17 4. Bank of America Merrill Lynch 58,978.1 28 4. Simpson Thacher & Bartlett LLP 52,735.8 26 5. Barclays Plc 54,934.0 31 5. Davis Polk & Wardwell LLP 40,381.8 17 6. Citigroup 54,842.0 35 6. Paul, Weiss, Rifkind, Wharton & Garrison 36,622.2 32 7. Lazard 47,783.9 29 7. Sullivan & Cromwell LLP 32,986.4 21 8. Deutsche Bank AG 31,845.3 16 8. Cravath, Swaine & Moore LLP 24,609.7 12 9. RBC Capital Markets 30,600.2 19 9. Linklaters LLP 24,431.2 8 10. Evercore Partners, Inc. 29,011.9 26 10. Latham & Watkins LLP 24,224.8 43 11. HSBC Holdings Plc 24,896.3 6 11. Clifford Chance LLP 24,140.0 14 12. Rothschild & Co 21,497.1 20 12. Vinson & Elkins LLP 23,645.5 15 13. Robey Warshaw LLP 17,710.3 1 13. Weil, Gotshal & Manges LLP 22,607.8 25 14. Credit Suisse 16,587.6 15 14. Andrews Kurth Kenyon LLP 21,650.3 5 15. Centerview Partners LLC 16,437.2 11 15. Morrison & Foerster LLP 20,709.5 21 16. Raymond James Financial, Inc. 14,852.4 19 16. Blake, Cassels & Graydon LLP 20,001.2 18 17. Jefferies LLC 14,386.0 14 17. Jones Day LP 19,256.3 62 18. UBS Group AG 12,650.4 9 18. Stikeman Elliott LLP 17,383.8 10 19. The Toronto-Dominion Bank 10,246.3 5 19. Akin, Gump, Strauss, Hauer & Feld LLP 15,135.3 9 20. BDT & Co. LLC 9,765.6 3 20. Debevoise & Plimpton LLP 14,651.2 10 21. Moelis & Co. 8,517.4 17 21. Houthoff Buruma Coöperatief UA 13,786.1 3 22. Bank of Montreal 7,804.9 10 22. Yigal Arnon & Co. 13,740.5 2 23. PJT Partners, Inc. 6,896.7 7 23. Goldfarb Seligman & Co. 13,706.0 1 24. Stifel, Nicolaus & Co., Inc. 5,900.4 23 23. Van Campen Liem 13,706.0 1 25. Sandler O'Neill & Partners 5,825.9 17 25. Bennett Jones LLP 13,463.4 2 26. Wells Fargo & Co. 5,393.7 11 26. Wachtell, Lipton, Rosen & Katz 12,756.4 14 27. SMB Capital LLC 4,800.0 1 27. Gibson, Dunn & Crutcher LLP 12,282.3 17 28. Mitsubishi UFJ Morgan Stanley 4,286.9 2 28. Potter Anderson & Corroon LLP 12,087.7 2 29. Nomura Securities Co., Ltd. 4,018.8 4 29. Fried, Frank, Harris, Shriver & Jacobson 10,564.8 10 30. Piper Jaffray Cos. 3,951.3 11 30. Bracewell LLP 10,182.6 6 31. Allen & Co., Inc. 3,475.8 4 31. Covington & Burling LLP 9,992.2 11 32. Société Générale SA 3,385.8 2 32. Allen & Overy LLP 9,806.7 14 33. Mizuho Financial Group, Inc. 3,264.4 2 33. McDermott Will & Emery LLP 9,061.3 8 34. National Bank of Canada 3,130.7 2 34. Willkie Farr & Gallagher LLP 8,953.0 14 35. Highbury Partnership Pty Ltd. 3,037.2 1 35. Sidley Austin LLP 8,815.2 8 36. Houlihan Lokey, Inc. 2,706.0 23 36. Wilson Sonsini Goodrich & Rosati 8,532.0 16 37. Petrie Partners Securities LLC 2,671.6 1 37. Goodmans LLP 7,756.5 4 38. Guggenheim Capital LLC 2,643.6 4 38. Hogan Lovells 6,925.3 24 39. PricewaterhouseCoopers 2,402.2 16 39. Paul Hastings LLP 6,579.3 17 40. Intrepid Partners LLC 2,300.0 1 40. Squire Patton Boggs (US) LLP 6,451.2 6 41. Ernst & Young Global Ltd. 2,205.6 8 41. Herbert Smith Freehills LLP 6,066.1 9 42. Macquarie Group 2,178.0 4 42. Fenwick & West LLP 5,885.3 17 43. BNP Paribas SA 2,148.7 3 43. Arnold & Porter Kaye Scholer LLP 5,843.5 8 44. Canadian Imperial Bank of Commerce 2,121.6 1 44. Dechert LLP 4,993.0 8 45. Banco Bilbao Vizcaya Argentaria SA 2,100.0 1 45. Shearman & Sterling LLP 4,736.9 12 46. CITIC Securities Co., Ltd. 2,080.0 1 46. O'Melveny & Myers LLP 4,658.9 5 47. MTS Health Partners LP 1,870.7 3 47. Ropes & Gray LLP 4,140.7 9 48. Banks Street Partners LLC 1,772.0 2 48. Richards, Layton & Finger PA 3,816.3 1 49. Perella Weinberg Partners Group LP 1,737.1 4 49. Troutman Sanders LLP 3,567.6 5 50. Genesis Capital LLC 1,736.2 1 50. Baker Botts LLP 3,540.0 5

* Transaction Value is the aggregate base equity plus the target’s net debt, where applicable. ** Total Deals includes deals that reported a deal value as well as those that did not. If you would like to participate in our league table rankings or have questions about league table criteria, please contact [email protected].

Top US Deals Scoreboard April 2017

Seller (Unit Sold) Buyer Transaction

Financial Advisor Financial Advisor Value**

Rank Legal Advisor Legal Advisor ($Mil) Seller Sector

Akzo Nobel NV PPG Industries, Inc. $25,086.0 Process Industries 1 Lazard Goldman Sachs & Co.

Mead Johnson Nutrition Co. Reckitt Benckiser Group Plc $17,710.3 Consumer Non- Goldman Sachs & Co. Bank of America Merrill Lynch Durables Morgan Stanley Deutsche Bank AG Cleary Gottlieb Steen & Hamilton LLP HSBC Holdings Plc 2 Kirkland & Ellis LLP Robey Warshaw LLP Clifford Chance LLP Davis Polk & Wardwell LLP Linklaters LLP

ONEOK Partners LP ONEOK, Inc. $17,118.1 Industrial Services Barclays Plc JPMorgan Chase & Co. 3 Andrews Kurth Kenyon LLP Morgan Stanley Simpson Thacher & Bartlett LLP Skadden, Arps, Slate, Meagher & Flom LLP

Mobileye NV Intel Corp. $13,729.3 Producer Goldman Sachs & Co. Citigroup Manufacturing Raymond James & Associates, Inc. Rothschild & Co. 4 Goldfarb Seligman & Co. Houthoff Buruma Coöperatief UA Morrison & Foerster LLP Skadden, Arps, Slate, Meagher & Flom LLP Van Campen Liem Sullivan & Cromwell LLP Yigal Arnon & Co.

VCA, Inc. Mars, Inc. $8,821.3 Health Services Barclays Plc BDT & Co. LLC Akin, Gump, Strauss, Hauer & Feld LLP Morgan Stanley 5 Cleary Gottlieb Steen & Hamilton LLP McDermott Will & Emery LLP Potter Anderson & Corroon LLP Simpson Thacher & Bartlett LLP Skadden, Arps, Slate, Meagher & Flom LLP

Bass Family (Permian Basin Oil Fields Business) XTO Energy, Inc.; Exxon Mobil Corp. $6,600.0 Industrial Services 6 Davis Polk & Wardwell LLP

WGL Holdings, Inc. AltaGas Ltd. $6,584.3 Utilities Goldman Sachs & Co. JPMorgan Chase & Co Lazard TD Securities, Inc. 7 Cleary Gottlieb Steen & Hamilton LLP Stikeman Elliott LLP Covington & Burling LLP Vinson & Elkins LLP Cravath, Swaine & Moore LLP Kirkland & Ellis LLP

STADA Arzneimittel AG Advent International Corp. $5,013.7 Health Technology 8 Deutsche Bank AG Bank of America Merrill Lynch Morgan Stanley

ARIAD Pharmaceuticals, Inc. Takeda Pharmaceutical Co., Ltd. $4,908.2 Health Technology Goldman Sachs & Co. Evercore Partners, Inc. JPMorgan Chase & Co Cleary Gottlieb Steen & Hamilton LLP Lazard Morrison & Foerster LLP 9 Fried, Frank, Harris, Shriver & Jacobson LLP Jones Day LP Paul, Weiss, Rifkind, Wharton & Garrison LLP Simpson Thacher & Bartlett LLP Sullivan & Cromwell LLP

Aon Plc (Employee Benefits Outsourcing Business) The Blackstone Group LP $4,800.0 Commercial Services Moelis & Co. Citigroup 10 Morgan Stanley Credit Suisse Paul, Weiss, Rifkind, Wharton & Garrison LLP SMB Capital LLC Sidley Austin LLP Kirkland & Ellis LLP **Total Market Value of Top 10 Deals YTD $110,371.1