An Acuris Company An Acuris report on global M&A activity May 2018 Monthly M&A Insider mergermarket.com Mergermarket Monthly M&A Insider May 2018 2 Contents An Acuris report on global M&A activity Contents Global Overview 4 US & Canada 12 Central & South America 19 Europe 26 Middle East & Africa 33 Asia-Pacific (excluding Japan) 40 Japan 47 mergermarket.com Mergermarket Monthly M&A Insider May 2018 3 Welcome Welcome from Merrill Corporation The Monthly M&A Insider explores the global The decidedly less flashy Industrial & by the tax reform law; European businesses M&A market with respect to the numbers, Chemicals sector also held its own in the are seeking deals to fuel inorganic growth; movements and trends, as well as revealing the deal value column thanks to the third-largest and Asia-Pacific acquirers are expanding their top financial and legal advisers — globally and transaction in April: the US$30.1bn merger presence on the world stage and diversifying across six regions (North America, Central and of US refineries Marathon Petroleum and from domestic markets. Equity prices have Mike Sabutis South America, Europe, Middle East and Africa, Andeavor, creating the country’s biggest seen a modest retreat worldwide and an Senior Vice President, Asia-Pacific and Japan). refiner by capacity. increase in volatility, but the global economy Merrill Corporation remains stable and growing. Dealmakers are This year has started with a spate of One area of M&A that finally cooled off last likely to remain busy in the months ahead. megadeals — and the pace of these mammoth month was private equity (PE). After a record- combinations only quickened in April. Three of breaking first quarter for buyout value, PE the six biggest deals by value since the start of deal activity came back down to earth with Sincerely, 2018 were announced in the month, including a humdrum US$33.2bn in aggregate value US-based telecommunications provider (compared to US$120.6bn in the first three Mike Sabutis Sprint’s merger proposal with rival T-Mobile months of the year). None of the top 10 Senior Vice President in a transaction valued at US$58.9bn. The transactions in April involved a financial buyer deal would allow the companies to accelerate acquiring an asset. The tenth biggest deal did, development of 5G wireless technology, they however, represent a PE exit — the US$5.5bn say, even as consumer advocates warn that it sale of Sky Betting and Gaming by UK-based could drive up prices for mobile service. CVC Capital Partners and Sky to Canadian online gambling company Stars Group. Consolidation ramped up further in the global media industry as well in April with That sale was one of just three cross-border the second-largest deal of the month: US deals in the top 10 for the month, as the cable giant Comcast’s bid for a majority stake slowdown in international M&A continued. in European pay-TV operator Sky valued at The rising tide of protectionism and trade US$40.7bn. Separately, Comcast is reportedly barriers — and the uncertainty surrounding considering a hostile bid for 21st Century potential future actions — appear to be Fox assets that Disney won in December, in a taking their toll on cross-border activity. deal that would allow Comcast to consolidate Nonetheless, M&A value in 2018 remains on 100% control of Sky. (Incidentally, all this deal track to nearly match the highest amount ever, activity involving major media companies is US$3.87tn, reached in 2015. US companies injecting uncertainty into the upcoming TV are still actively putting to work funds freed up lineups for their networks.) mergermarket.com Mergermarket Monthly M&A Insider May 2018 4 Global Overview Part of the Acuris report on global M&A activity Global Overview mergermarket.com Mergermarket Monthly M&A Insider May 2018 5 Global Overview Global Overview Further information Another month, another chasm between value as US$174.8bn worth of deals in the PE dealmaking was also strong as buyout Get in touch or read more value and volume in the global M&A market. region accounted for a 50.4% market share. houses seemed determined to keep pace April saw 992 deals valued at US$346.9bn with their strategic rivals. So far this year, PE Six of the top 10 deals had bidders from — up 40.9% by value, but with 523 fewer has deployed US$153.9bn on 953 deals — an Nick Cheek North America including the top deal of the deals compared to 1,515 transactions worth increase of 33% on the same period last year. month — the aforementioned acquisition US$246.3bn in April 2017. of Sprint by telecoms rival T-Mobile for As we head into May, the M&A market is Aram Hovsepian The dynamics behind the dealmaking an estimated US$58.9bn. The deal would buoyant, posting well over US$1tn worth of market have remained similar for some time merge the third- and fourth-largest mobile deals with two months of Q2 still to go. And now. On the buy side, confident cash-rich carriers in the US and create a company with a number of large transactions in the corporates and private equity firms with with around 130 million customers. pipeline and continued economic stability plenty of dry powder are being encouraged across most regions, we could well be Europe, Asia-Pacific and even Central & South by shareholders and activists alike to spend heading for a record year in the deal market. America (a region which has seen heavy falls big on assets that will either increase market in recent months) all posted large gains as share, expand regional focus, or digitally the global M&A market began to heat up disrupt their sector. On the sell side, valuations considerably after a somewhat quiet start to continue to rise as fewer top-quality assets the year. make it into the marketplace. The most high-profile transaction in Europe was Digital disruption has been a major driver the proposed merger between supermarket as traditional sectors such as Automotive, giants Sainsbury and Asda for US$10bn. The Retail and Healthcare race to keep pace with companies are such a staple part of UK life a rapidly changing marketplace. However, that the deal featured on the front pages of all that said, it would seem that the biggest the UK broadsheets and tabloids when it was factor behind April’s value hike is market announced at the tail end of the month. consolidation. The much publicized mergers between US mobile carriers T-Mobile and Sector-wise, the T-Mobile/Sprint deal, coupled Sprint; oil refiners Marathon and Andeavor; with Comcast’s bid for UK broadcaster Sky, and supermarket chains Sainsbury and Asda propelled the Telecommunications sector were all predicated on challenging the number into top spot with US$60bn worth of deals. one incumbents in their respective industries. This was followed by Industrials & Chemicals (US$57.6bn) and Media (US$43bn). Indeed, In terms of regions, every one bar Middle East three of the top five deals came from the & Africa posted a value increase in April. As overarching TMT space. usual, North America took the lion’s share of mergermarket.com Mergermarket Monthly M&A Insider May 2018 6 Global Overview Top Financial Advisor 992 deals Goldman Sachs & Co valued at US$346.9bn, up 40.9% by value with 523 fewer deals compared to 1,515 ranked first with 30 deals worth US$132.6bn, deals worth US$246.3bn in April 2017. up 91.2% in value with 6 more deals compared to 24 deals worth US$69.4bn in April 2017. Top Sector Top Legal Advisor Telecommunications Goodwin Procter saw 9 deals valued at US$60bn, up 3,453.8% ranked first with 9 deals worth US$69.7bn, up by value with 2 fewer deals compared to 11 502.7% in value with 17 fewer deals compared deals worth US$1.7bn in April 2017. to 26 deals worth US$11.6bn in April 2017. Mergermarket.commergermarket.com Mergermarket Monthly M&A Insider May 2018 7 Global Overview Global M&A trend Global Private Equity trend 4,000 20,000 600 3,500 18,000 3,500 3,000 US$ 500 1,201.3 16,000 3,000 US$ 827.4 US$ 14,000 2,500 1,030.5 US$ 892.5 400 2,500 12,000 Number of deals of Number Number of deals of Number US$ 2,000 874 2,000 US$ 10,000 US$ US$ 300 571.7 861.3 US$ 727.7 US$ US$ US$ Value (US$bn) Value Value (US$bn) Value 870.4 536.4 536.7 US$ 521.1 1,500 8,000 496.6 1,500 US$ 454.3 US$ US$ US$ US$ 416.5 658 US$ 200 407.6 401.4 6,000 1,040.4 US$ 757.2 US$ 1,000 1,000 US$ US$ 346.9 US$ 964.9 US$ 739.5 298.8 295.4 4,000 US$ 561.7 100 US$ 500 US$ 500 US$ 2,000 153.9 US$ US$ 918.6 124.8 US$ 762.4 US$ 752.6 US$ 568.5 626.5 446.7 0 0 0 0 2013 2014 2015 2016 2017 YTD 2018 2013 2014 2015 2016 2017 YTD 2018 Q1 value Q3 value Volume Buyout value Buyout volume Q2 value Q4 value Exit value Exit volume mergermarket.com Mergermarket Monthly M&A Insider May 2018 8 Global Overview Regional Trends Telecommunications Value: US$60bn Number of deals: 9 Market share: 17.3% Industrials & Chemicals C&S America Asia-Pacific Value: US$57.7bn North America US$9.3bn Number of deals: 204 (excluding Japan) Market share: 16.6% US$174.8bn 29 deals US$59.5bn 2.7% Media 343 deals 264 deals Value: US$43bn 17.2% Number of deals: 35 50.4% Market share: 12.4% Energy, Mining & Utilities Value: US$29.9bn Number of deals: 66 Market share: 8.6% Technology Europe Japan Value: US$27.9bn Middle East US$4.9bn Number of deals: 143 & Africa US$97.3bn 23 deals Market share: 8% US$1bn 1.4% 14 deals 319 deals 0.3% 28.1% Domestic US$236.2bn +61.5% Cross-border US$100.7bn +10.7% mergermarket.com Mergermarket Monthly M&A Insider May 2018 9 Global Overview Top deals Top 10 Announced Deals for April 2018 Value (US$m) Deal details Advisor details