Aviation and Aerospace M&A Quarterly – Q3 2016
01 November 2016
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ICF (formerly ICF SH&E) is pleased to present the 13th edition of Aviation and Aerospace M&A Quarterly, published in association with Mergermarket. This publication highlights activity and trends in aircraft, airlines, aerospace, airport and tourism M&A in Q3 2016.
Key points from this report include:
- General Electric demonstrated its confidence in the additive manufacturing business with the acquisition of two 3D printing firms – Arcam and SLM Solutions – for a combined value of US$1.4bn.
- Rolls-Royce agreed to acquire 53.1% of Spanish aircraft engine maker ITP for US$795m.
- Qatar Airways upped its stake in IAG to 20.01%, acquired 49% of Italy’s Meridiana and agreed to take a 10% stake in LATAM Airlines Group for US$613.
- North American firms were the top targets in Q3 of 2016, with 12 companies being acquired.
Into the unknown: European M&A Outlook 2016
02 November 2016
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Mergermarket is pleased to present the fourth edition of the European M&A Outlook, published in association with CMS.
Our survey provides a unique contrast of the expectations of European M&A pre- and post-Brexit, as corporates and private equity firms wrestle with its consequences for their businesses and dealmaking prospects.
Key findings include:
- Brexit hits expectations. Two-thirds of respondents believe that European M&A will fall when asked in the aftermath of the Brexit vote, compared with just 18% in our survey earlier in the year. Dealmakers are wary of the uncertainty, which could potentially pause activity both in the UK and beyond as companies wait for the dust to settle.
- Bargain hunters. An upside of the Brexit vote for buyers is its effect on the price of assets. Post-Brexit, 54% say that undervalued targets will be one of the greatest buy-side drivers, compared with 39% before the vote. Among corporates and private equity firms considering acquisitions, favourable prices are seen as a key motivator by almost nine in ten.
- Cross-border drive. While European dealmakers may have hit the brakes, the sentiment for international buyers remains strong. Almost four-fifths anticipate more cross-border M&A into Europe next year, while 61% think the value of these deals will increase. Buyers from North America and China in particular will look to snap up assets to fuel overseas growth.
Market Spotlight: US Election
07 November 2016
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The US presidential race has spurred a great deal of speculation about the new administration’s impact on the domestic economy and dealmaking. One thing that seems certain is that regulations and rules championed by a new administration will cause shifts in the deal landscape. Changes in compliance requirements imposed on the financial sector could cause further momentum toward consolidation among banks, for instance. Trade has also been a hot-button issue, and any amendments to US agreements with other countries are likely to have a significant effect on outbound deals.
In order to find out how the results of the election will influence deal activity, Donnelley Financial Solutions commissioned Mergermarket to interview industry dealmakers on their views of how inbound and outbound M&A activity may change, select sectors that will be most impacted, and forecast overall M&A deal flow for 2017.
According to the survey, 44% of respondents believe that strong economic growth will drive M&A for 2017. Many participants, however, point to high valuations (44%) and unfavorable regulatory changes (40%) as risk factors to watch for in the coming year.
Powering the flow of global capital: Capital markets issuer insights
10 November 2016
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What is driving today’s global capital marketplace? This is the question we sought to answer in our survey of more than 200 institutional investors, banks, financial sponsors, broker-dealers, sovereign institutions, corporate and financial institution issuers and investor relations executives, conducted on behalf of Deutsche Bank Global Securities Services in the summer of 2016. The results highlight three trends focusing on financial regulations, new technology and emerging market volatility.
Key findings:
TREND 1: THE MARKET WELCOMES THE RIGHT REGULATIONS
- Basel III (62%) and Solvency II (48%) are seen as regulations bringing the most benefits.
- FATCA is seen as offering the fewest benefits (53%) and considered the most burdensome.
- The greatest concerns regarding the changing regulatory environment are: increased costs (43%), a reduction in liquidity (31%) and increased counterparty credit risk charges (26%).
TREND 2: BLOCKCHAIN IS COMING SOONER THAN YOU THINK
87% say blockchain and distributed ledger technology will affect the market for securities services.
78% believe this technology will be actively used within the next six years.
38% say blockchain could reduce the cost of providing securities services by more than 20%.
TREND 3: EMERGING MARKETS ARE DUE A REVIVAL
- 54% believe emerging markets will deliver growth rates last seen during the 2001–11 boom within the next four years.
- 76% say that a lack of capital markets infrastructure deters them from operating or investing in otherwise attractive emerging markets.
- 88% cite India/South Asia as the most attractive region for long-term growth prospects.
Powering the flow of global capital: Capital markets investor insights
10 November 2016
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What is driving today’s global capital marketplace? This is the question we sought to answer in our survey of more than 200 institutional investors, banks, financial sponsors, broker-dealers, sovereign institutions, corporate and financial institution issuers and investor relations executives, conducted on behalf of Deutsche Bank Global Securities Services in the summer of 2016. The results highlight three trends focusing on financial regulations, new technology and emerging market volatility.
Key findings:
TREND 1: THE MARKET WELCOMES THE RIGHT REGULATIONS
- Basel III (62%) and Solvency II (48%) are seen as regulations bringing the most benefits.
- FATCA is seen as offering the fewest benefits (53%) and considered the most burdensome.
- The greatest concerns regarding the changing regulatory environment are: increased costs (43%), a reduction in liquidity (31%) and increased counterparty credit risk charges (26%).
TREND 2: BLOCKCHAIN IS COMING SOONER THAN YOU THINK
- 87% say blockchain and distributed ledger technology will affect the market for securities services.
- 78% believe this technology will be actively used within the next six years.
- 38% say blockchain could reduce the cost of providing securities services by more than 20%.
TREND 3: EMERGING MARKETS ARE DUE A REVIVAL
- 54% believe emerging markets will deliver growth rates last seen during the 2001–11 boom within the next four years.
- 76% say that a lack of capital markets infrastructure deters them from operating or investing in otherwise attractive emerging markets.
- 88% cite India/South Asia as the most attractive region for long-term growth prospects.
The ABC of Fintech: Acquisitions, Brexit and Collaboration
24 November 2016
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Mergermarket is pleased to present The ABC of Fintech: Acquisitions, Brexit and Collaboration, in association with Mayer Brown.
The study, which canvassed the opinions of 120 senior executives at UK-headquartered financial services and fintech companies, looks at how the two are planning to work together in the coming years, and whether regulation and geopolitical volatility will hold them back.
Key findings include:
- Financial services and fintech firms are set to become close friends in the next three years: 49% of financial services firms say they expect to engage in a joint venture with a fintech firm in the next three years, while 26% say they expect to acquire a fintech firm over the same period.
- Most financial services and fintech firms favour some form of self-regulation: 60% of fintech respondents say a self-regulated environment with limited regulatory oversight is ideal, while 76% of financial services respondents think clear regulatory oversight with some self-regulation is best. 33% of respondents say Germany is the European country with regulation most conducive to growth in the fintech industry while 31% point to the UK.
- Brexit is sowing some uncertainty in fintech and making it difficult to find the right talent: 78% of fintech and 76% of financial services respondents say attracting and retaining talented employees from the EU has become more difficult since the referendum. 82% of respondents are concerned that access to European markets from the UK will be restricted as passporting rules will no longer apply after Brexit.
Market Spotlight: Cybersecurity
30 November 2016
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As the overall volume and value of cross-border transactions has continued to rise this year, cybersecurity has become a top priority for businesses. In the past few months alone several Internet giants have fallen victim to hackers and cyber-attacks. Given that experts estimate a single breach costs an average of US$4m per company, it should come as no surprise that limitations in the cybersecurity infrastructure of a target company can disrupt or even derail otherwise promising deals.
In order to gain an understanding of how cybersecurity is impacting M&A transactions, Donnelley Financial Solutions commissioned Mergermarket to interview leading industry experts from around the world for their views.
According to the survey’s findings, 64% of respondents say it is more difficult to cope with cybersecurity issues at a target firm when it comes to cross-border M&A deals versus domestic deals. Meanwhile, 88% of respondents agree that cross-border deals within the financial services sector are the most impacted by cybersecurity issues.
Monthly M&A Insider - November 2016
01 December 2016
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October was the strongest month for M&A so far in 2016, and the highest value October in Mergermarket’s history (since 2001). Five mega-deals were the main drivers of this record-breaking month, reaching a total US$227.4bn and accounting for 53.9% of October’s total M&A value. The largest of these deals was AT&T’s US$105bn acquisition of Time Warner. Due to this, the Media sector led October, coming in at 31 deals worth US$106.6bn, up 1,334.4% in value from last year. North American companies were the most sought after for October, with six target companies located in the US being involved in the top 10 deals of the month.
Highlights from this report include:
- AT&T’s acquisition of Time Warner accounted for 24.9% of the global M&A value for the month and 98.5% of the Media sector’s total value.
- Private equity buyouts saw a 4.8% increase in value, while exits experienced a 19.3% drop when compared to October 2015.
- The largest European transaction, which accounted for 54.5% of the European market share, was the acquisition of Netherlands-based NXP Semiconductors by US-based Qualcomm for US$45.9bn.
The Insurance M&A Success Tracker: Measuring M&A and share price performance
02 December 2016
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Toppan Vite – M&A Pulse: M&A lessons from 2016
05 December 2016
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While the North American M&A market experienced a slow start and an overall decline in both deal volumes and values during 2016, respondents are split on their perceptions of this year’s deal climate. A boost in activity during October, however, has perhaps fueled optimism as corporates look toward 2017 with hopes of growing stability.
Toppan Vite, a trusted financial printing and communications company, in partnership with Mergermarket, is pleased to present the fourth M&A Pulse newsletter. This newsletter features responses from 25 US-based senior dealmakers who were interviewed on the current and future state of the US M&A market.
Key findings include:
- The promotion of business growth was the most common (24%) strategic driver of M&A activity for respondents.
- Some 60% of respondents said they have increased deal activity in North America during the past 12 months.
- The impact of the US election was the largest primary concern for respondents, however Britain’s vote to exit the EU followed closely behind.
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