Monthly M&A Insider November 2014 - Amazon S3 · size, however, is the highest since Q1 2010...

A MERGERMARKET REPORT ON GLOBAL M&A ACTIVITY

MONTHLY M&A INSIDERNOVEMBER 2014

Monthly M&A Insider | November

INSIDE:

GLOBAL OVERVIEW

LATIN AMERICA

NORTH AMERICA

ASIA-PACIFIC

EUROPE

MIDDLE EAST & AFRICA

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GLOBAL OVERVIEW

Monthly M&A Insider | November | 01

Head of Research: Elias Latsis

Editor: Laura Resetar

For advertising opportunities contact: Erik Wickman Tel: + (1) 212 686 3329 [email protected]

Global Overview: Dan Kim and Karen Sibayan

Latin America: Elizabeth Lim and Raquel Mozzer

North America: Nicole Corazza and Urna Chakraborty

Asia-Pacific: Chris Wong and Brandon Taylor

Europe: Damien Julliard and Melly Wells

Middle East & Africa: Damien Julliard and Andrea Putaturo

Playing right into this mega deal trend is the Energy, Mining & Utilities sector, which saw many of the top transactions during the month.

Dominating October M&A activityEnergy, Mining & Utilities dominated October 2014’s deal activity. With the concentration of large deals in the sector, it was at the top in terms of the aggregate value of transactions in October, with a total of 116 transactions worth US$55bn. Driven by a series of factors that ran the gamut, the sector was also part of the top five industries in terms of the number of deals during the month.

Although the largest deal of the month, the BD/CareFusion transaction, is from the Pharma, Medical & Biotech sector, there were several large-cap Energy Mining & Utilities transactions led by a Latin America transaction. In October, Gas Natural Fenosa (GNF) made a public offer to purchase Compania General de Electricidad for close to US$8bn in a cross-border deal while Targa Resources Partners announced its close to US$6bn acquisition of Atlas Pipeline Partners through a share exchange. During the month, Targa Resources Corp. also bought natural gas liquid services company Atlas Energy Inc for roughly US$5bn. Master limited partnership Targa Resources owns public companies Targa Resources Partners and Targa Resources Corp.

A theme in M&A in this sector is companies looking to become a bigger presence in high-growth markets. For instance, one of the attractions of Compania General for Fenosa is the fact that there is an expected rising demand for natural gas and electricity in Latin America.

Another key trend that the sector has seen, specifically in the US, has to do with the ownership by master limited partnerships (MLP) of pipelines. For instance, the Atlas Pipeline purchase comes after a series of transactions involving US pipeline firms seen in 2014. Through the acquisition, Targa Resources Partners can tap into Texas’ Eagle Ford Formation as well as the Mississippi’s Lime and Woodford Lime plays.

Also in October, producer of natural gas Chesapeake Energy Corporation sold assets in the Southern Marcellus Shale and a portion of the Eastern Utica Shale in West Virginia to Southwestern Energy Co for US$5.4bn.

Regulated utilities also drove the month’s M&A activity. October saw the roughly US$5bn purchase by a consortium led by Macquarie of regulated utility Cleco Corporation. The group of buyers was probably drawn by the advantages of Cleco’s being regulated since this factor limits both the volatility related to earnings and that seen in the commodities sector. Given the weak natural gas prices, utility companies have had to deal with stiff competition arising from pricing pressures.

The value of global M&A deals through the end of October has surpassed aggregate 2013 numbers, further illustrating a trend that has been apparent all of 2014. Indeed, deal sizes have skyrocketed during the year given the many large-cap and transformative transactions. The biggest deal for October is the almost US$12bn acquisition of New Jersey-based medical equipment company Becton, Dickinson and Co (BD) of San Diego-headquartered medical technology company CareFusion Corporation. CEO confidence in the M&A market has boosted the number of these mega transactions in 2014.

TREND GRAPHS

GLOBAL OVERVIEW Monthly M&A Insider | November | 02

GLOBAL M&A QUARTERLY TREND GLOBAL M&A QUARTERLY PRIVATE EQUITY TREND

GLOBAL M&A ANNUAL TREND GLOBAL M&A ANNUAL PRIVATE EQUITY TREND

Num

ber of deals

0

100

200

300

400

500

600

700

800

900

YTD 2014*201320122011201020092008

Valu

e (U

S$bn

)

Buyout value Exit value Buyout volume Exit volume

0

500

1,000

1,500

2,000

2,500

3,000

3,500

Num

ber of deals

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

YTD 2014*201320122011201020092008

Total value Mid-market value Total volume Mid-market volume

Valu

e (U

S$bn

)

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

Valu

e (U

S$bn

)

Num

ber of deals

0

50

100

150

200

250

300

350

400

Q414*

Q314

Q214

Q114

Q413

Q313

Q213

Q113

Q412

Q312

Q212

Q112

Q411

Q311

Q211

Q111

Q410

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108


0

100

200

300

400

500

600

700

800

900

Valu

e (U

S$bn

)

Num

ber of deals

0

200

400

600

800

1,000

1,200

1,400

Q414*

Q314

Q214

Q114

Q413

Q313

Q213

Q113

Q412

Q312

Q212

Q112

Q411

Q311

Q211

Q111

Q410

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108


0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500


TREND GRAPHS

GLOBAL M&A SECTOR BREAKDOWN YTD 2014

VALUE VOLUME

GLOBAL M&A GEOGRAPHIC BREAKDOWN YTD 2014

VALUE VOLUME

12.2%

18.9%

12.1%

11.9%

8.0%

4.3%

7.5%

10.3%

3.3%3.3%

3.9%

1.2%1.1%2.0%

Industrials & Chemicals

Technology

Consumer

Business Services

Energy, Mining & Utilities

Financial Services

Pharma, Medical & Biotech

Leisure

Media

Construction

Transportation

Real Estate

Telecommunications

Agriculture

6.9%

11.1%

11.6%

5.6%

18.9%6.6%

12.0%

3.3%

4.4%

10.2%

0.8%

2.7%

3.0%

2.9%


Technology

Consumer

Business Services


Financial Services


Leisure

Media

Construction

Transportation

Real Estate

Telecommunications

Agriculture

35.4%

35.5%

24.4%

2.6%

2.1%

North America

Europe

Asia-Pacific

Central & South America

Middle East & Africa

50.5%

22.6%

18.7%

5.8%

2.4%

North America

Europe

Asia-Pacific

Central & South America

Middle East & Africa


TREND GRAPHS

GLOBAL M&A DEAL SIZE BREAKDOWN YTD 2014

VALUE VOLUME

Return to contents

80

82

84

86

88

90

92

94

96

98

100

YTD 2014*201320122011201020092008

Perc

enta

ge

90.1% 90.9%89.3% 89.0% 89.2%

0.9% 1.0% 1.1% 1.0% 1.0%

4.6% 3.9%

4.5% 4.8% 4.7%

3.8% 3.7%4.7% 4.7% 4.7%

0.6% 0.6%0.4% 0.5%0.5% 0.4% 0.4%

89.9%

0.9%

4.3%

4.5%

88.5%

1.2%

5.0%

4.7%

US$0-US$250m

US$251m-US$500m

US$501m-US$2,000m

US$2,001m-US$5,000m

>US$5,001m

0

10

20

30

40

50

60

70

80

90

100

YTD 2014*201320122011201020092008

Perc

enta

ge

41.9% 40.5%

27.3% 30.0% 29.2%

8.9% 7.9% 9.7% 10.1% 9.8%

15.2% 16.5%

20.3% 18.9% 19.4%

19.4% 20.4%27.5% 26.2% 27.5%

14.6% 14.7% 15.2% 14.8% 14.1%

38.9%

8.7%

18.0%

22.1%

12.3%

28.2%

9.9%

18.8%

28.0%

15.1%

US$0-US$250m

US$251m-US$500m

US$501m-US$2,000m

US$2,001m-US$5,000m

>US$5,001m

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A MERGERMARKET M&A REPORT ON

LATIN AMERICA


October overall was a slow month in M&A activity, with 27 deals worth US$10.3bn. Average deal size, however, is the highest since Q1 2010 (US$624m) with US$379m, a 29.7% increase from deal size in Q3 2014 (US$292m).

In the year-to-date (YTD), there were 436 deals announced in 2014, with a total value of US$115.1bn and an average deal size of US$264m. The total value of transactions already surpassed 2013 when 660 deals were announced valued at US$88.3bn and is close to surpassing 2012 as well, when 683 deals were announced valued at US$116.2bn. But deal volume is currently the lowest since 2009, when 397 deals were announced.

The most active sector in the YTD is Energy, Mining & Utilities with 87 deals valued at US$47.5bn. Consumer is second with 66 deals worth US$6.8bn, from which 11 were announced in October alone. The two top deals of the month remained in the Energy sector.

Gas Natural Fenosa launched a public offer to acquire Companía General de Electricidad SA (CGE), from the Marin family, Grupo Almería, Perez Cruz family and other minority shareholders for a consideration of US$7.5bn. The second highest deal in the region was the acquisition of 80% stake in Companía Contractual Minera Candelaria and Compaíia Contractual Minera Ojos del Salado from Freeport-McMoRan by Lundin Mining Corporation for US$1.8bn. The remaining 20% stake in the operations will remain with Sumitomo Corporation.

Since both top deals targeted Chilean companies, the country had the highest value for transactions in October, with the combined two deals worth almost US$4.7bn. In the YTD, Brazil is still the undisputed leader in the region with 223 deals valued at US$43bn, followed by Mexico with 60 deals valued at US$17.4bn. Chile comes third with 38 deals valued at US$30.5bn.

Brazil’s uncertainties came to an end but the market still has not seen any sign of recovery. The World Cup ended with no incidents and elections were finally held. Dilma Rousseff won with one of the narrowest margins in the country’s history – three percentage points – in an election that split the nation. The re-elected President won with clear majority in the North and Northeast regions. The South, Southeast and Central West largely voted for the opposition candidate, Aécio Neves. These last three regions account for 81% of Brazil’s GDP, 82% of formal jobs, 85% of exports and 90% of tax revenues. Overall, Brazil’s economy voted largely for Aécio Neves, but Dilma now has the duty to run the country for the next four years.

For the past four years, Dilma implemented ad hoc tax breaks and price controls and tried to push down lending rates, but to no avail. The economy has seen the slowest growth rate since the early 1990s, slipping into recession in the first half of the year. As a result, even with the end of the political uncertainty that lay in Brazil for the past year, there is still no light at the end of the tunnel to reheat the market and increase the amount of M&A activity.


TOP DEALS

LATIN AMERICA

TOP 11 LATIN AMERICAN ANNOUNCED DEALS OF THE MONTH (OCT-14)Announced Bidder company Target company Target dominant

sectorSeller company Exit multiples (x) Bid premia

1-day before

Deal value

(US$m) Revenue EBITDA P/E

12-Oct-14 Gas Natural Fenosa Compania General de Electricidad SA


Marin family (private individuals); Grupo Almeria; Perez Cruz family (private individuals)

1.9 9.9 23.2 32.8% 7,577

06-Oct-14 Lundin Mining Corporation Compania Contractual Minera Candelaria (80% stake); and Compania Contractual Minera Ojos del Salado (80% stake)


Freeport-McMoRan Copper & Gold Inc

- - - - 1,800

02-Oct-14 Restoque Comercio e Confeccoes de Roupas SA

Dudalina S/A Consumer Warburg Pincus LLC; Advent International Corporation

3.2 - - - 583

01-Oct-14 Alpargatas SA Terras de Aventura Industria de Artigos Esportivos (30% stake)

Consumer - - - - - 65

14-Oct-14 Platino Energy Corporation Colombia Energy Development Company


Global Energy Development PLC

1.6 - - - 50

24-Oct-14 CAMIL Alimentos S/A Romero Trading SA Consumer The Romero Group SAC - - - - 29

28-Oct-14 Sophia Capital Partners Industria y Tecnologia en Aceros SA; Valvulas Worcester de Argentina SA; Esferomatic SA; Norpatagonica SA; and Valvulas W. San Luis SA


Lupatech SA - - - - 22

24-Oct-14 Tigre SA Condor SA (paintbrush unit) Consumer Condor SA - - - - 17

16-Oct-14 Gentera SAB de CV Pagos Intermex SA De CV Business Services Holding Monex SAB de CV - - - - 16

13-Oct-14 Linx SA Big Sistemas TMT 2.8 - - - 16

03-Oct-14 Molinos Rio de la Plata SA Mondelez Argentina (pasta business)

Consumer Mondelez Argentina SA - - - - 16

Based on announced deals, including lapsed and withdrawn bids Based on dominant geography of target company being Latin America Data correct as of 17-Nov-14

Source: Mergermarket

TREND GRAPHS

LATIN AMERICA Monthly M&A Insider | November | 08

LATIN AMERICAN M&A QUARTERLY TREND

LATIN AMERICAN M&A ANNUAL TREND

LATIN AMERICAN M&A QUARTERLY PRIVATE EQUITY TREND

LATIN AMERICAN M&A ANNUAL PRIVATE EQUITY TREND

Num

ber of deals

0

2,000

4,000

6,000

8,000

10,000

12,000

YTD 2014*201320122011201020092008

Valu

e (U

S$m

)


0

10

20

30

40

50

60

70

Num

ber of deals

0

20

40

60

80

100

120

140

160

180

YTD 2014*201320122011201020092008


Valu

e (U

S$bn

)

0

100

200

300

400

500

600

700

800

Valu

e (U

S$m

)

Num

ber of deals

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

Q414*

Q314

Q214

Q114

Q413

Q313

Q213

Q113

Q412

Q312

Q212

Q112

Q411

Q311

Q211

Q111

Q410

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108


0

5

10

15

20

25

30

Valu

e (U

S$bn

)

Num

ber of deals

0

10

20

30

40

50

60

70

Q414*

Q314

Q214

Q114

Q413

Q313

Q213

Q113

Q412

Q312

Q212

Q112

Q411

Q311

Q211

Q111

Q410

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108


0

50

100

150

200

250

LATIN AMERICAN M&A GEOGRAPHIC BREAKDOWN YTD 2014

LATIN AMERICA Monthly M&A Insider | November | 09

TREND GRAPHS

VALUE VOLUME

LATIN AMERICAN M&A SECTOR BREAKDOWN YTD 2014

VALUE VOLUME

0.2%

0.8%1.0%

0.7%

7.0%

15.9%

3.8%

1.1%

4.9%

8.5%

3.0% 5.9%

41.5%

5.7%


Consumer


Business Services

Financial Services

Technology

Media

Leisure


Transportation

Telecommunications

Agriculture

Construction

Real Estate

5.7%0.2%0.2%

37.5%

26.5%

0.6%

0.7% 3.4%

9.2%

0.6%

15.2%

0.2%

Brazil

Chile

Colombia

Costa Rica

Ecuador

Mexico

Panama

Peru

Uruguay

Venezuala

Argentina

Bolivia

0.2%

8.7%

51.2%

6.9%

5.7%

13.8%

0.7%0.7%

0.5%

8.7%

0.2%

0.2%0.2%

0.7%

0.9%0.7%

Brazil

Chile

Colombia

Costa Rica

Domincan Republic

Ecuador

El Salvador

Guatemala

Honduras

Mexico

Panama

Peru

Uruguay

Venezuala

Argentina

Bolivia

14.0%

15.1%

20.0%3.4%

4.4%

4.4%

8.3%

9.9%

7.3%

3.0%3.2%

4.1%

1.1%1.8%


Consumer


Business Services

Financial Services

Technology

Media

Leisure


Transportation

Telecommunications

Agriculture

Construction

Real Estate

LATIN AMERICAN M&A DEAL SIZE BREAKDOWN YTD 2014

VALUE VOLUME

Return to contentsLATIN AMERICA Monthly M&A Insider | November | 10

TREND GRAPHS

20

30

40

50

60

70

80

90

100

YTD 2014*201320122011201020092008

Perc

enta

ge

88.2% 85.8% 86.4% 86.7%

4.8% 6.8% 8.0%6.2% 5.7%

5.2%5.3%

6.6%5.5% 6.6%

1.2% 1.8% 2.0% 1.1% 0.7%0.6% 0.3% 1.2% 1.1%0.9%0.8% 0.3%

86.4%

5.9%

6.8%1.8%

83.1%

6.0%

8.0%

US$0-US$250m

US$251m-US$500m

US$501m-US$2,000m

US$2,001m-US$5,000m

>US$5,001m

82.2%

0

10

20

30

40

50

60

70

80

90

100

YTD 2014*201320122011201020092008

Perc

enta

ge

30.3%

9.2%

39.2%28.6%

21.8%

9.9% 10.1%

7.5%

9.6%

10.3%13.8%

25.1%36.6%

24.7%

28.5%

33.4%

20.1%

29.3%

19.0%

18.2%

14.3%

14.6% 14.8% 14.4% 16.7%

16.2%

45.4%

17.2%

21.2%8.2%

24.4%

35.0%

22.7%

9.7%

US$0-US$250m

US$251m-US$500m

US$501m-US$2,000m

US$2,001m-US$5,000m

>US$5,001m



NORTH AMERICA

October brought both economic and political uncertainty and it showed in the Pharma, Medical & Biotech sector. Government enacted tax changes affected transactions due to an effort to curb acquisitions made by companies that help them shift their tax domicile in order to avoid paying taxes in their home country. AbbVie’s lapsed US$50bn acquisition of Shire Plc is a prime example of the new policy change having an effect on M&A. However, October’s top deal – Becton Dickinson’s US$11.9bn acquisition of CareFusion – remained unaffected, as did Endo International’s US$2.3bn acquisition of Auxilium Pharmaceuticals. The Pharma, Medical & Biotech sector is the second largest by value in the year to date, with 417 deals worth US$189.7bn and a 14.9% market share by value.

The Energy, Mining & Utilities sector was very active in October with multiple billion dollar transactions, such as Targa Resources Partners’ US$5.6bn acquisition of Atlas Pipeline, Southwestern Energy Company’s US$5.4bn acquisition of Chesapeake Energy’s Southern Marcellus and Utica shale assets, and a consortium led by Macquarie’s US$4.7bn acquisition of Cleco Corporation. The Energy, Mining & Utilities sector is the largest by value in the year to date, with 580 deals collectively valued at US$292bn, reflecting a 23.2% market share.

The TMT sector’s top deal in October was NetScout Systems’ US$2.6bn acquisition of Fluke Networks, Arbor Networks and Tektronix Communications from Danaher Corporation in order to create a larger provider of tools that test networks and help protect corporations from security threats. The consolidated sector in the year to date saw 897 deals collectively valued at US$287.5bn.

An update on the Alibaba Group’s debut on the New York Stock Exchange in September showed that Yahoo’s profit rose after earning US$6.3bn from selling part of its stake in Alibaba. Despite this increase, however, Yahoo’s advertising business has been lackluster in recent years. Despite a string of recent purchases under Marissa Mayer’s leadership, the tech giant’s future seems uncertain when compared to competitors such as Google. Yahoo is rumoured to be in talks with Snapchat for an acquisition of a small stake so it will be interesting to see what direction the company takes in the future.

North American M&A value for October ended with a total of 362 deals worth US$88.3bn, a year-on-year increase of 31.6% by value and a 14.2% increase by volume from October 2013 (317 deals, US$67.1bn), but an overall slow start to the quarter. Buyouts in October increased by 5.9% by value and exits decreased 30.8% by value compared to the comparable period last year, suggesting apprehension in the market.


TOP DEALS

NORTH AMERICA

TOP 10 NORTH AMERICAN ANNOUNCED DEALS OF THE MONTH (OCT-14)Announced Bidder company Target company Target dominant


1-day before

Deal value

(US$m) Revenue EBITDA P/E

05-Oct-14 Becton, Dickinson and Company

CareFusion Corporation Pharma, Medical & Biotech

- 3.1 14.5 29.6 25.6% 11,944

13-Oct-14 Targa Resources Partners LP Atlas Pipeline Partners LP Energy, Mining & Utilities

- 2.7 75.6 (loss) 15.0% 5,651

16-Oct-14 Southwestern Energy Company Chesapeake Energy Corporation (Southern Marcellus and Utica shale assets)


Chesapeake Energy Corporation

- - - - 5,375

13-Oct-14 Targa Resources Corp Atlas Energy Inc Energy, Mining & Utilities

- 1.9 20.7 (loss) 0.0% 4,945

20-Oct-14 Macquarie consortium Cleco Corporation Energy, Mining & Utilities

- 4.3 10.1 20.9 14.7% 4,723

01-Oct-14 Enterprise Products Partners LP Oiltanking Partners LP (65.92% stake)

Transportation Oiltanking Holding Americas Inc

32.7 47.3 57.3 - 4,623

13-Oct-14 NetScout Systems Inc Fluke Networks Inc; Arbor Networks Inc; and Tektronix Communications

TMT Danaher Corporation 3.1 - - - 2,619

19-Oct-14 Tesoro Logistics LP QEP Field Services Company Energy, Mining & Utilities

QEP Resources Inc 6.2 10.6 - - 2,500

31-Oct-14 Omega Healthcare Investors Inc Aviv REIT Inc Real Estate - 17.6 44.0 71.4 16.2% 2,476

09-Oct-14 Endo International plc Auxilium Pharmaceuticals Inc Pharma, Medical & Biotech

- 5.6 (loss) (loss) 14.1% 2,251

Based on announced deals, including lapsed and withdrawn bids Based on dominant geography of target company being North America (US + Canada) Data correct as of 07-Nov-14


TREND GRAPHS

NORTH AMERICA Monthly M&A Insider | November | 13

NORTH AMERICAN M&A QUARTERLY TREND

NORTH AMERICAN M&A ANNUAL TREND

NORTH AMERICAN M&A QUARTERLY PRIVATE EQUITY TREND

NORTH AMERICAN M&A ANNUAL PRIVATE EQUITY TREND

Valu

e (U

S$bn

)

Num

ber of deals

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

YTD 2014*201320122011201020092008


0

1,000

2,000

3,000

4,000

5,000

6,000

Valu

e (U

S$bn

)

Num

ber of deals

0

50

100

150

200

250

300

350

400

450

500

YTD 2014*201320122011201020092008


0

200

400

600

800

1,000

1,200

Valu

e (U

S$bn

)

Num

ber of deals

0

50

100

150

200

250

Q414*

Q314

Q214

Q114

Q413

Q313

Q213

Q113

Q412

Q312

Q212

Q112

Q411

Q311

Q211

Q111

Q410

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108


0

50

100

150

200

250

300

350

Valu

e (U

S$bn

)

Num

ber of deals

0

100

200

300

400

500

600

Q414*

Q314

Q214

Q114

Q413

Q313

Q213

Q113

Q412

Q312

Q212

Q112

Q411

Q311

Q211

Q111

Q410

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108


0

200

400

600

800

1,000

1,200

1,400

1,600

Monthly M&A Insider | November | 14NORTH AMERICA

NORTH AMERICAN M&A SECTOR BREAKDOWN YTD 2014

VALUE VOLUME

NORTH AMERICAN M&A DEAL SIZE BREAKDOWN YTD 2014

VALUE VOLUME

TREND GRAPHS

Return to contents

75

80

85

90

95

100

YTD 2014*201320122011201020092008

Perc

enta

ge

90.6% 91.1%

87.6% 87.6% 87.2%

0.9% 1.0% 1.1% 1.4% 1.4%

4.1% 3.8%

5.2% 5.4%5.0%

3.7% 3.4%5.5% 4.9% 5.9%

0.7% 0.7% 0.6% 0.6%0.5%

86.5%

1.5%1.0%

5.5%

5.5%

0.7%

88.5%

1.1%

4.5%

5.3%

US$0-US$250m

US$251m-US$500m

US$501m-US$2,000m

US$2,001m-US$5,000m

>US$5,001m

0

10

20

30

40

50

60

70

80

90

100

YTD 2014*201320122011201020092008

Perc

enta

ge

49.0%58.6%

31.8%37.3%

32.2%

7.3%5.5%

9.8% 9.0% 8.2%

17.4%

13.2%

27.6%20.8% 27.4%

13.9%

13.3%

17.9%

20.9%21.2%

12.4% 9.4% 12.9% 12.0% 11.0%

41.7%

7.4%

24.3%

15.6%

48.6%

16.6%

8.7%

6.8%

19.3%

11.0%

US$0-US$250m

US$251m-US$500m

US$501m-US$2,000m

US$2,001m-US$5,000m

>US$5,001m

16.9%

15.3%

13.0%

12.8%

9.4%

9.3%

8.6%

3.2%

2.9%

1.0%

2.0%0.7%

0.6%0.2%

4.1%


Technology


Business Services

Consumer


Financial Services

Media

Leisure

Construction

Transportation

Real Estate

Telecommunications

Agriculture

Defence

10.0%

8.0%

23.2%

5.7%11.3%

14.9%

4.7%

0.7%

2.6%0.8%

2.0%

3.5%

12.6% Industrials & Chemicals

Technology


Business Services

Consumer


Financial Services

Media

Leisure

Construction

Transportation

Real Estate

Telecommunications



ASIA-PACIFIC

M&A activity in October saw a total of 225 deals with a combined value of US$28.5bn in Asia-Pacific. This was an increase in the number of deals, but a decrease in total value of US$29.7bn during the same month last year.

Trends across the region Across Asia-Pacific, China again leads the way for M&A activity. A total of 89 transactions took place at a value of US$12.1bn. This amounted to 39.6% of the total regional deal volume and 42.3% of the total deal value. Compared to the same time last year, this represents an increase on both the volume and value of deals. The largest announced deal in China came within the Energy, Mining & Utilities sector, where Chinese firm Huaneng Power International made a series of bids for varying stakes in companies held by China Huaneng Group, such as the 91.8% stake in Huaneng Hainan Power Inc.

However, this was not the largest deal to take place in the region. US firm Platform Speciality Products Corporation bid US$3.5bn for the acquisition of Japanese Arysta LifeScience Corporation from UK firm Permira Advisers LLP. This deal, in the Industrial and Chemicals sector, helped Japanese M&A reach 11.1% of regional volume with 25 deals and 20.5% of the total value representing US$5.8bn.

Sectors on the moveIndustrials & Chemicals still remains a popular investment space in the region. In October it recorded 52 deals to make up 23.1% of the market share at a value of US$9.4bn. Outside of the deal for Japanese firm Arysta LifeScience Corporation, the next largest was Dongkuk Steel Mill’s bid for South Korean firm Union Steel for a value of US$866m. This helped South Korean inbound M&A activity reach US$2.8bn in October.

TMT also had another positive month, the 40 deals in this sector made up 17.8% of the volume of deals in the region. This was a significant increase on the 29 deals announced at the same time last year.

Focus on Western Australia The recent announcement by the federal government in Australia to start a long-term scheme of asset privatisation has added to the growing feeling of opportunity within the market. This is especially true for Chinese and Japanese corporations on the back of recent free-trade agreements (FTA) that should increase inbound deals from these countries. The FTAs will lower tariffs in strategically key sectors between the countries, which will also help increase transactional volume flowing both ways.

This growing importance of trade between these countries is no more apparent than within Western Australia. Sectors likely to benefit here include agribusiness, energy, and major infrastructure projects within the utilities sector. The year-to-date in the Australian M&A market has seen some 391 inbound deals, at a combined value of US$52.8bn. It is hoped that the government asset privatisation and increasing strategic ties through FTAs will see this number rise in 2015.

TOP DEALS

Monthly M&A Insider | November | 16ASIA-PACIFIC

TOP 10 ASIA-PACIFIC ANNOUNCED DEALS OF THE MONTH (OCT-14)Announced Bidder company Target company Target

dominant sector

Seller company Exit multiples (x) Bid premia 1-day before

Deal value

(US$m)Revenue EBITDA P/E

20-Oct-14 Platform Specialty Products Corporation

Arysta LifeScience Corporation Industrials & Chemicals

Permira Advisers LLP 2.34 - - - 3,510

13-Oct-14 Huaneng Power International Inc

Huaneng Hainan Power Inc (91.8% stake); Huaneng Wuhan Power Generation Co Ltd (75% stake); Huaneng Suzhou Thermal Power Co Ltd (53.45% stake); Enshi Qingjiang Dalongtan Hydropower Development Co Ltd (97% stake); and Huaneng Hualiangting Hydropower Co Ltd


China Huaneng Group - - - - 1,195

13-Oct-14 Dongkuk Steel Mill Co Ltd

Union Steel Co Ltd Industrials & Chemicals

- 0.41 n/a n/a -68.9% 866

29-Oct-14 Pacific Viscose Limited Sateri Holdings Limited (Viscose Staple Fiber business)


Sateri Holdings Limited - - - - 834

24-Oct-14 Huadian Energy Company Limited

Liaoning Huadian Tieling Power Generation Co Ltd (51% stake)


China Huadian Corporation

1.91 6.30 9.45 - 813

31-Oct-14 Guangzhou Shipyard International Company Limited

CSSC Huangpu Wenchong Shipbuilding Co Ltd


China State Shipbuilding Corporation

0.45 - 13.43 - 738

15-Oct-14 Fragmented Industry Exchange Inc

HotApps International Pte Ltd Technology Singapore eDevelopment Limited

- - - - 700

28-Oct-14 SoftBank Internet and Media Inc

Jasper Infotech Private Limited (30% stake)

Technology - - - - - 627

01-Oct-14 ADAMA Agricultural Solutions Ltd

Jiangsu Anpon Electrochemical Co Ltd; Jiangsu Huaihe Chemical Co Ltd; Jiangsu Maidao Agrochemical Co Ltd; and Jingzhou Sanonda Holdings


China National Agrochemical Corporation

0.73 4.45 - - 623

20-Oct-14 Bellshill Investment Company

Lifestyle International Holdings Limited (19.9% stake)

Consumer Real Reward Limited 4.46 7.34 9.99 1.2% 616

n/a=not applicable Based on announced deals, including lapsed and withdrawn bids Based on dominant geography of target company being Asia-Pacific Data correct as of 07-Nov-14


TREND GRAPHS


ASIA-PACIFIC M&A QUARTERLY TREND

ASIA-PACIFIC M&A ANNUAL TREND

ASIA-PACIFIC M&A QUARTERLY PRIVATE EQUITY TREND

ASIA-PACIFIC M&A ANNUAL PRIVATE EQUITY TREND

ASIA-PACIFIC

Valu

e (U

S$bn

)

Num

ber of deals

0

10

20

30

40

50

60

70

80

YTD 2014*201320122011201020092008


0

50

100

150

200

250

300

350

Valu

e (U

S$bn

)

Num

ber of deals

0

100

200

300

400

500

600

YTD 2014*201320122011201020092008


0

500

1,000

1,500

2,000

2,500

3,000

3,500

Valu

e (U

S$bn

)

Num

ber of deals

0

5

10

15

20

25

30

Q414*

Q314

Q214

Q114

Q413

Q313

Q213

Q113

Q412

Q312

Q212

Q112

Q411

Q311

Q211

Q111

Q410

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

0

20

40

60

80

100

120

0

20

40

60

80

100

120


Valu

e (U

S$bn

)

Num

ber of deals

0

20

40

60

80

100

120

140

160

180

200

Q414*

Q314

Q214

Q114

Q413

Q313

Q213

Q113

Q412

Q312

Q212

Q112

Q411

Q311

Q211

Q111

Q410

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108


0

100

200

300

400

500

600

700

800

900

1,000

ASIA-PACIFIC M&A SECTOR BREAKDOWN YTD 2014

ASIA-PACIFIC M&A GEOGRAPHIC BREAKDOWN YTD 2014

VALUE VOLUME

VALUE VOLUME


TREND GRAPHS

13.0%

20.4%

11.2%

10.3%

9.3%

7.3%

6.3%

5.8%

3.9%

3.8%

3.0%3.2%

1.5%

0.7% 0.1%

0.2%


Technology

Consumer


Business Services

Financial Services


Leisure

Transportation

Media

Construction

Real Estate

Agriculture

Telecommunications

Defence

Other


Technology

Consumer


Business Services

Financial Services


Leisure

Transportation

Media

Construction

Real Estate

Agriculture

Telecommunications

Defence

Other

8.9%

11.5%

9.6%

15.2%

5.8%9.3%

3.5%

3.1%

3.1%

8.1%

2.6%

6.9%

0.9%

2.1%

0.5%8.9%

37.7%

8.7%13.7%

4.2%

7.9%

10.7%

2.9%

3.7%

1.2%

1.8%7.5%

China

South Korea

Australia

Hong Kong

Japan

India

Singapore

Malaysia

Taiwan

Indonesia

Other

46.0%

13.4%

10.9%

6.8%

4.9%

5.3%

2.3%

3.8%

1.2% 1.0%

4.4%China

South Korea

Australia

Hong Kong

Japan

India

Singapore

Malaysia

Taiwan

Indonesia

Other


ASIA-PACIFIC M&A DEAL SIZE BREAKDOWN YTD 2014

VALUE VOLUME

TREND GRAPHS

Return to contents

75

80

85

90

95

100

YTD 2014*201320122011201020092008

Perc

enta

ge

88.5%

0.9%

5.7%

4.5%

0.4% 0.3%0.4%

87.9% 88.8% 87.6% 88.5%

1.0% 1.4% 0.8% 0.9%

5.3%5.1%

5.9%5.6%

5.4% 4.4% 5.3% 4.7%

0.4% 0.3% 0.3%0.3%

88.0%

5.6%

0.7%

5.4%

87.9%

6.2%

0.9%

4.7%

US$0-US$250m

US$251m-US$500m

US$501m-US$2,000m

US$2,001m-US$5,000m

>US$5,001m

0

10

20

30

40

50

60

70

80

90

100

YTD 2014*201320122011201020092008

Perc

enta

ge

13.5%

34.5%

13.4%

15.2%

23.4%

13.1%

24.1%

22.7%

17.6%

22.5%

29.6%19.9%

13.5%24.4% 20.6%

12.0% 11.2% 11.2% 12.0% 12.2%

22.2%30.3% 26.5% 29.7% 28.7%

15.7%

17.0% 26.7%13.5% 16.6%

20.5% 22.1% 20.4% 21.9%

US$0-US$250m

US$251m-US$500m

US$501m-US$2,000m

US$2,001m-US$5,000m

>US$5,001m

21.6%



EUROPE

Nutreco in the fish bowl for competing bids

After several stake purchases and an increased bid, the highest valued deal in October saw listed Dutch animal nutrition and fish feed company Nutreco, acquired by SHV Holdings acquire for US$4bn. The deal has led to anticipation of a bidding war for the company. Since the offer, Nutreco has attracted competing bids that it may entertain if the offer is at least 8% higher than SHV price, as reports by Mergermarket. Doubts surrounds the 95% acceptance criteria for the merger to proceed and so SHV has a plan B up its sleeve – the company intends to commence statutory squeeze-out proceedings “or pursue an alternative structure (e.g. statutory (cross-border) merger or asset transaction) as soon as it is permitted to do so,” said SHV’s CEO Knut Nesse said in a media call. SHV has not operated in this sector before which is partially why bankers are expecting a trade bid to appear. North America’s Cargill and the Netherlands’ DSM could be early front-runners as potential rival bidders for Nutreco, a top-20 investor and a sector banker said.

French market bolsters European activityThe French market has attracted a strong level of activity throughout 2014, resulting in the YTD value of US$136.5bn reaching the second highest value on record (since 2001). The country has also seen some large transactions this year which has led to the average price being paid for a French target being US$237m, the fourth highest in Europe. The largest during October was the second highest valued deal in Europe during the month over all. The deal saw Bollore, the French conglomerate controlled by Vincent Bollore, making an offer to acquire the remaining stake it does not own (63.8%) in Havas, a French media company for US$2.5bn.

The deal is reported to be part of a wider consolidation strategy in France’s media industry, according to Mergermarket intelligence. Industry sources, including WPP chief executive Martin Sorrell, speculated that a tie-up with Vivendi could be Bollore’s next move. The 20 deals targeting French Media deals has already matched the number seen in 2012 and 2013 but with a value of US$8bn surpassing every other year since 2006.

The grass is greener in Europe

A new found confidence in European companies from other regions during 2014 has resulted in inbound deal values from non-European companies reaching the highest on Mergermarket record at US$251bn. Europe saw quite a drop in inbound deal values from other regions in 2013 from 2012 despite more deals but this year there has been almost a third (32.3%) more activity based on value.

Interestingly, countries such as Germany and Italy, subjects of economic scrutiny in recent months, have been attracting Chinese investment. Even though China’s total outbound M&A isn’t quite as productive as expected following last year’s record value (US$55.2bn), there have been 20 deals targeting Germany total US$1.3bn so far in 2014 – Germany’s Industrials & Chemicals sector has been the most sought after (13 deals) with the largest transaction being the exit of Hilite International by AVIC Electromechanical Systems for US$644m. At the same time, the 10 transactions targeting Italian companies amount to US$3.5bn, marking the highest deal value and deal count on Mergermarket record. Germany country’s Industrials & Chemicals sector being the most sought after (13 deals) with the largest transaction being the exit of Hilite International by AVIC Electromechanical Systems for US$644m.

Europe has attracted a high level of investment throughout 2014 but as the economic outlook begins to dampen in light of stalled eurozone growth and Germany narrowly missing another recession, time will tell if investors hold back for the final months of the year.

The start of Q4 has been slow for European M&A activity with October’s 356 deals experiencing a 38.7% drop by value from the previous month. A total of US$41bn-worth of deals seems to have continued from a drop seen in Q3 from Q2 2014. However, despite a negative economic outlook at the start of the Autumn, the year-to-date (YTD) value is still 11.2% higher than the whole of 2013 (US$642.1bn) at US$714.1bn.

TOP DEALS

Monthly M&A Insider | November | 21EUROPE

TOP 10 EUROPEAN ANNOUNCED DEALS OF THE MONTH (OCT-14)Announced Bidder company Target company Target dominant


1-day before

Deal value


20-Oct-14 SHV Holdings NV Nutreco NV Consumer - 0.9 14.1 20.7 61.3% 4,509

17-Oct-14 Bollore SA (63.8%) Havas SA Media 1.7 10.9 19.2 19.5% 2,532

13-Oct-14 Petronas Gas Berhad Shah Deniz gas field (15.5% stake); and South Caucasus Pipeline Company Limited (15.5% stake)


Statoil ASA - - - - 2,250

13-Oct-14 Steris Corporation Synergy Health Plc Pharma, Medical & Biotech

- 3.5 13.5 33.8 39.3% 2,130

15-Oct-14 Qualcomm Incorporated CSR Plc Technology - 2.2 - - 36.7% 2,088

13-Oct-14 GE Capital Aviation Services LLC

Milestone Aviation Group Limited

Financial Services JZ Capital Partners Limited; The Jordan Company LP; and Nautic Partners LLC

- - - - 1,775

16-Oct-14 Ferrovial SA; and Macquarie Group Limited

Aberdeen International Airport Ltd; Southampton Airport; and Glasgow Airport Limited

Transportation Heathrow Airport Holdings Ltd

- - - - 1,678

14-Oct-14 Geberit AG Sanitec Oy Industrials & Chemicals

- 1.7 12.5 25.0 54.6% 1,560

16-Oct-14 Medical Properties Trust Inc; and Waterland Private Equity Investments BV

Median Kliniken GmbH & Co KG Pharma, Medical & Biotech

Advent International Corporation; and Marcol Group

2.0 11.1 - - 1,280

10-Oct-14 Twenty-First Century Fox Inc/Apollo Global Management LLC (joint venture)

Endemol NV (28% stake); CORE Media Group; and Shine Group Limited

Media Twenty-First Century Fox Inc; and Apollo Global Management LLC

- - - - 1,000

Based on announced deals, including lapsed and withdrawn bids Based on dominant geography of target company being Europe Data correct as of 19-Nov-14


TREND GRAPHS


EUROPEAN M&A ANNUAL TREND EUROPEAN M&A ANNUAL PRIVATE EQUITY TREND

EUROPEAN M&A QUARTERLY PRIVATE EQUITY TREND

EUROPEAN M&A QUARTERLY TREND

EUROPE

Num

ber of deals

0

50

100

150

200

250

300

350

YTD 2014*201320122011201020092008


Valu

e (U

S$bn

)

0

200

400

600

800

1,000

1,200

1,400

1,600

Valu

e (U

S$bn

)

Num

ber of deals

0

200

400

600

800

1,000

1,200

1,400

1,600

YTD 2014*201320122011201020092008


0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

Valu

e (U

S$bn

)

Num

ber of deals

0

20

40

60

80

100

120

140

Q414*

Q314

Q214

Q114

Q413

Q313

Q213

Q113

Q412

Q312

Q212

Q112

Q411

Q311

Q211

Q111

Q410

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

0

50

100

150

200

250

300

350

400

450


Num

ber of deals

0

100

200

300

400

500

600

Q414*

Q314

Q214

Q114

Q413

Q313

Q213

Q113

Q412

Q312

Q212

Q112

Q411

Q311

Q211

Q111

Q410

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108


Valu

e (U

S$bn

)

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000


EUROPEAN M&A GEOGRAPHIC BREAKDOWN YTD 2014

EUROPEAN M&A SECTOR BREAKDOWN YTD 2014

VALUE VOLUME

TREND GRAPHS

VALUE VOLUME

EUROPE

14.9%

1.6%

20.5%

6.5%7.5%

4.1%2.2%

13.1%

9.3%

3.8%

0.2%0.9%

3.9%

4.5%7.0%


Consumer

Telecommunications



Financial Services

Construction

Real Estate

Business Services

Media

Technology

Leisure

Transportation

Agriculture

Defence

11.2%

10.1%

12.4%

9.9%

7.2%

7.1%

5.9%

6.0%

4.1%

3.9%3.3%

2.9%1.2%

0.2%

14.6% Pharma, Medical & Biotech

Consumer

Telecommunications



Financial Services

Construction

Real Estate

Business Services

Media

Technology

Leisure

Transportation

Agriculture

Defence

21.3%

12.0%

12.1%

1.8%6.0%

5.8%

3.5%

6.7%

0.6%

4.3%

3.4%

13.6%

6.2%

2.7%

France

UK

Germany

Republic of Ireland

Switzerland

Netherlands

Spain

Italy

Russia

Norway

Sweden

Portugal

CEE (excl. Russia)

Others

19.2%

10.0%

15.4%

7.0% 8.0%

6.0%

4.8%

3.9%

2.4%

4.2%

3.1%2.1%

5.9%

8.0%France

UK

Germany

Republic of Ireland

Switzerland

Netherlands

Spain

Italy

Russia

Norway

Sweden

Portugal

CEE (excl. Russia)

Others

Monthly M&A Insider | November | 24EUROPE

TREND GRAPHS

EUROPEAN M&A DEAL SIZE BREAKDOWN YTD 2014

VALUE VOLUME

Return to contents

80

82

84

86

88

90

92

94

96

98

100

YTD 2014*201320122011201020092008

Perc

enta

ge

90.6%93.1% 92.1%

91.1% 91.7%

0.9% 0.9% 0.7% 0.9% 0.8%

4.2%

2.9%3.2%

3.6%3.7%

3.7%2.7% 3.7% 4.0%

3.5%

0.6%

91.1%

1.0%

3.6%

3.9%

0.4% 0.4%0.4%

92.4%

0.9%

3.2%

3.3%

US$0-US$250m

US$251m-US$500m

US$501m-US$2,000m

US$2,001m-US$5,000m

>US$5,001m

0.3% 0.3% 0.2%

0

10

20

30

40

50

60

70

80

90

100

YTD 2014*201320122011201020092008

Perc

enta

ge

44.4%

8.3%

19.2%

15.0%

13.1%

33.6%28.6% 26.6%

33.3%

8.5% 9.0% 9.8% 9.6%

20.9%29.1% 29.0%

25.5%

20.7%18.7% 20.4%

18.9%

16.3% 14.6% 14.2% 12.7%

22.0%

10.3%

27.5%

25.7%

14.5%

35.7%

8.4%

25.0%

19.6%

11.3%

US$0-US$250m

US$251m-US$500m

US$501m-US$2,000m

US$2,001m-US$5,000m

>US$5,001m



THE MIDDLE EAST & AFRICA

October’s good performance was attributable mainly to one particular deal: the US$2.5bn acquisition of a 30% stake in some of Shell’s Nigerian oil assets by a consortium led by oil-trading firm Taleveras Group. This single operation was responsible for 60% of total activity and it represented the second largest transaction for the year so far. The highest-value deal in 2014 was still the Algerian Fonds National d’Investissement’s purchase of a 51% stake in Orascom Telecom Algerie for US$2.6bn last April.

The Shell-Taleveras deal propelled the Energy, Mining & Utilities sector to the top spot in terms of value: 45 transaction worth a total of US$8.9bn were agreed YTD, equivalent to a 23.4% market share. It is worth pointing out that the Mining sub-sector accounted close to zero, with Energy and, to a lesser extent, Utilities, making up most of the total. Telecommunications came in second (US$6.9bn of deals and a 18.2% market share), followed by Real Estate (US$6.1bn; 16%) and Financial Services (US$4.2bn; 11.1%). At the end of Q3 14, Telecommunications was the dominant sector (US$6.8bn), with Real Estate (US$6.1bn) and Energy, Mining & Utilities (US$4.8bn) in second and third place respectively.

Although many African operators in the banking and financial segment are still relatively small compared to their foreign peers, the sector is drawing increasing attention and resources from foreign entities, eager to establish footprints in the region. Bob Diamond’s Atlas Mara investment vehicle has often been in the news recently, with as many as four transactions sealed so far in 2014. In a Financial Times article published in October, Diana Layfield, chief executive for Africa at UK-based bank Standard Chartered, spoke of the sector a “pretty dynamic market. We’ve seen competition for people, we’ve seen a lot of hiring …and now we are seeing new investors in the financial services sector, an obvious one being Atlas Mara.”

Shell’s sale of some of its Nigerian assets caused also a reshuffle in the country-by-country breakdown by value, with Nigeria rising to the top – US$6.7bn worth of deals were signed YTD, or 17.7% of the total. It was followed by South Africa (US$6.6bn; 17.3%), Qatar (US$5.9bn; 15.5%) and Israel (US$5.7; 15.1%). These four countries alone cover 66% of total M&A activity in the region. South Africa and Israel still saw the highest number of transactions, with 94 and 66 deals agreed so far this year respectively. Together they are equivalent to 48.5% of a total of 330.

Reflecting the increasing attractiveness of the region, UK-headquartered Allen & Overy announced in October the opening of an office in Johannesburg, South Africa. The law firm’s global managing partner Wim Dejonghe said that “Johannesburg has become a key hub for local and international banks, development institutions, institutional investors and funds looking at investment and finance opportunities in Sub-Saharan Africa. Building on the success of our launch in Casablanca, Johannesburg…offers a fantastic opportunity to take our Africa platform to the next level.” In the same vein, US law firm Orrick, Herrington & Sutcliffe set up an affiliated office in Abidjan, in Cote d’Ivoire, which “will provide on the ground support for the firm’s market-leading practice assisting African and international clients in connection with investments in Western and Central Africa,” according to a press release.

On the PE front, US$130m worth of buyout deals were signed in the month. Since 2007, only October 2009 registered less activity (US$80m). The total for the year so far stood at US$2.6bn, of which almost half (US$1.2bn) in the first quarter alone.

US-based buyout firm Carlyle, the worlds second by asset under management, was reported to have shelved plans in October to raise its second fund targeting the Middle East and North Africa (Mena) region, citing not enough interest by investors due to political uncertainties in some of the countries. Pointing to the complexity of the space, Karim Moussa, head of Cairo-based EFG Hermes’ private equity group, said to the Financial Times that “it’s difficult to raise a so-called Mena fund like people used to seven years ago. It’s not a homogeneous region, you can’t sell the whole block to investors any more. You have to think out of the box, focus on sectors, specific themes or countries.”

At US$4.4bn, exit deals YTD exceeded the 12-month total for whole previous years except 2007 (US$6.8bn). Average deal value has been growing steadily in the last three years, reaching US$187m in 2014. Most of activity occurred in the first two quarters (US$3.8bn), while October 2014 was markedly down on the same month last year – US$61m v. US$250m, a 75.6% drop.

M&A deal activity in the Middle East and Africa region got off on a positive start in Q4 2014. With a total of US$4.2bn worth of deals, October 2014 was the best October since 2010, when deal value stood at US$4.4bn. The month was also up 212% on the same period last year. Year-to-date (YTD) figures painted however a less rosy picture: deals amounting to US$37.9bn were signed in the first ten months of 2014, a 23.5% drop from the same period in 2013 (US$49.5bn). The number of transactions was instead slightly higher: 330 in 2014 against 326 in 2013.

TOP DEALS

Monthly M&A Insider | November | 26MIDDLE EAST & AFRICA

TOP 10 MIDDLE EASTERN & AFRICAN ANNOUNCED DEALS OF THE MONTH (OCT-14)Announced Bidder company Target company Target dominant


1-day before

Deal value


08-Oct-14 A consortium led by Taleveras Group

Oil Mining License 29 and associated pipeline in Nigeria (30% stake)


Royal Dutch Shell Plc - - - - 2,500

02-Oct-14 Undisclosed bidder International Bank of Qatar QSC (30% stake)

Financial Services National Bank of Kuwait SAK n/a n/a 11.8 - 538

02-Oct-14 Nedbank Group Limited Ecobank Transnational Incorporated (20.77% stake)

Financial Services - n/a n/a 18.2 -4.9% 493

02-Oct-14 Helios Investment Partners LLP

Wananchi Group Limited Technology - - - - - 130

04-Oct-14 Skye Bank Plc Mainstreet Bank Limited Financial Services AMCON Inc n/a n/a - - 124

14-Oct-14 Imperus Technologies Corporation

Diwip Ltd Technology Yaniv Gamzo (private investor); and Ehud Kantzuker (private investor)

3.5 6.8 - - 100

20-Oct-14 Econet Wireless Group U-Com Burundi SA; and Telecel Centrafrique SA

Telecommunications Telecel Globe Limited - - - - 65

19-Oct-14 Motorola Solutions Inc Jordan Dubai Islamic Bank (31.2% stake)

Financial Services - n/a n/a 68.6 - 43

27-Oct-14 Ascendis Health Limited The Scientific Group Proprietary Limited

- Brimstone Investment Corporation Limited; and Capitalworks

- - - - 35

02-Oct-14 DP World Limited World Security FZE Industrials & Chemicals

Istithmar World PJSC - - - - 26

n/a=not applicable Based on announced deals, including lapsed and withdrawn bids Based on dominant geography of target company being Middle East or Africa Data correct as of 10-Nov-14


TREND GRAPHS


MIDDLE EASTERN & AFRICAN M&A QUARTERLY TREND

MIDDLE EASTERN & AFRICAN M&A QUARTERLY PRIVATE EQUITY TREND

MIDDLE EASTERN & AFRICAN M&A ANNUAL TREND

MIDDLE EASTERN & AFRICAN M&A ANNUAL PRIVATE EQUITY TREND

Valu

e (U

S$bn

)

Num

ber of deals

0

2

4

6

8

10

12

14

YTD 2014*201320122011201020092008


0

10

20

30

40

50

60

70

Valu

e (U

S$bn

)

Num

ber of deals

0

10

20

30

40

50

60

70

80

90

100

YTD 2014*201320122011201020092008


0

100

200

300

400

500

600

Valu

e (U

S$m

)

Num

ber of deals

0

1,000

2,000

3,000

4000

5,000

6,000

7,000

Q414*

Q314

Q214

Q114

Q413

Q313

Q213

Q113

Q412

Q312

Q212

Q112

Q411

Q311

Q211

Q111

Q410

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108


0

5

10

15

20

25

Valu

e (U

S$m

)

Num

ber of deals

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

Q414*

Q314

Q214

Q114

Q413

Q313

Q213

Q113

Q412

Q312

Q212

Q112

Q411

Q311

Q211

Q111

Q410

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108


0

20

40

60

80

100

120

140

160


VOLUME

TREND GRAPHS

VALUE

MIDDLE EASTERN & AFRICAN M&A GEOGRAPHIC BREAKDOWN YTD 2014

VALUE VOLUME

10.9%

7.9%

13.0%

10.3% 11.5%

13.9%

3.3%

3.6%

4.8%

5.8%

3.0%3.9%

2.7%

0.3%

0.3%

4.8%


Financial Services

Business Services

Consumer


Technology

Media

Telecommunications

Leisure

Transportation


Construction

Real Estate

Agriculture

Defence

Other

2.6%

0.2%

18.2% 23.4%

1.1% 2.6%

1.2% 5.4%

16.0%

0.2%0.9%

11.0%

1.7%

8.3%

7.2%


Financial Services

Business Services

Consumer


Technology

Media

Telecommunications

Leisure

Transportation


Construction

Real Estate

Agriculture

Defence

MIDDLE EASTERN & AFRICAN M&A SECTOR BREAKDOWN YTD 2014

28.7%

2.1%

20.0%0.9%

10.6%

0.3%1.8%

4.2%

2.7%0.9%

0.9%0.9% 3.9%

0.9%

0.9%

0.3%0.6%

1.2%

0.6%1.2%

10.6% 5.8%Nigeria

South Africa

Qatar

Israel

Algeria

United Arab Emirates

Chad

Angola

Saudi Arabia

Ivory Coast

Egypt

Ghana

Namibia

Kenya

Cameroon

Senegal

Ethiopia

Morocco

Democratic Republicof Congo

Botswana

Tunisia

Other

17.8%

17.3%

1.2%

1.8%1.4%

3.1%2.3%

1.0%0.9% 0.6%

0.5% 0.4%

0.3%1.8%

6.9%

3.4%

7.1%

15.5%15.1%

Nigeria

South Africa

Qatar

Israel

Algeria

United Arab Emirates

Chad

Angola

Saudi Arabia

Ivory Coast

Egypt

Ghana

Namibia

Kenya

Cameroon

Senegal

Ethiopia

Morocco

Democratic Republicof Congo

Botswana

Tunisia

Other


MIDDLE EASTERN & AFRICAN M&A DEAL SIZE BREAKDOWN YTD 2014

VALUE VOLUME

TREND GRAPHS

Return to contents

0

10

20

30

40

50

60

70

80

90

100

YTD 2014*201320122011201020092008

Perc

enta

ge

42.4%47.3% 45.1% 46.7% 44.5%

5.6% 4.0%5.6% 6.1% 4.8%

11.5% 13.0%10.3% 11.3% 12.5%

36.5%32.4% 33.1% 28.7% 30.5%

4.0% 3.3% 5.9% 7.2% 7.7%

54.7%

4.3%

9.5%

25.8%

5.7%

49.7%

12.1%

27.6%

4.2%6.4%

US$0-US$14.9m

US$15m-US$100m

US$101m-US$250m

US$251m-US$500m

>US$501m

0

10

20

30

40

50

60

70

80

90

100

YTD 2014*201320122011201020092008

Perc

enta

ge

48.7%53.1%

67.8%58.2%

64.9%

13.4% 12.9% 9.0% 9.3% 8.2%

18.5%13.2%

12.5%

14.1% 13.9%

52.5%

10.0%

19.1%

17.1%17.7% 19.2%

9.6%

17.1%12.1%

1.6% 1.1% 1.3%

72.1%

6.5%

10.2%

10.2%

US$0-US$14.9m

US$15m-US$100m

US$101m-US$250m

US$251m-US$500m

>US$501m

1.7% 0.9% 1.0% 1.3%

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The following notes pertain to data contained in this publication:

Deals are included where the deal value is greater than or equal to US$5m.

Where no deal value has been disclosed, deals are included if the turnover of the target is greater than or equal to US$10m.

Deals are included in the graphs and Top Deals in each section based on the dominant geography and dominant sector of the target company. Data underlying the League Tables are based on deals where the bidder, target or parent geography of either is that of the geography in focus.

Mid-market is defined as US$10m - US$250m.

*Q4 2014 refers to the period 01-Oct-14 to 31-Oct-14. *YTD 2014 refers to the period 01-Jan-14 to 31-Oct-14.

For a full version of the Mergermarket M&A deal database inclusion and league table criteria, go to http://www.mergermarket.com/pdf/deal_criteria.pdf.

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