Global Mergers & Acquisitions Update

Transcription

1 Global Mergers & Acquisitions Update Investment Banking Corporate - 1 -Finance Strategy Consulting

2 United States US Sees Decreased M&A Activity During Q3 2015: With total deal value at US$482 billion, Q saw a 22.9% decrease in deal value from Q There were 5,116 announced transactions during Q3 2015, representing a 6.1% decrease from Q Compared to Q3 2014, deal value decreased by 23.4% and deal volume decreased 1.8%. During Q3 2015, the average deal size was approximately US$226 million. The median TEV/EBITDA multiple for disclosed deals during the quarter was 11.5x. U.S. M&A Transactions % S&P 500 ^SPX Dow Jones ^DJI NASDAQ ^COMP 1 5.0% -5.0% -7.8% -7.6% -8.3% -1 Middle-market private equity reported deals TEV/EBITDA multiples averaged 7.1x for TEVs between US$ million. Equity contribution for reported middle-market private equity M&A deal funding increased in Q to 44.2%, up from 39.8% in Q Deals involving better performers (TTM EBITDA margins and revenue growth rates both above 10%) accounted for 56% of reported activity in 2015 YTD, well in line with the historical average of 57% Private Equity-Sponsored M&A Activity 12.0x 10.0x 8.0x 6.0x 4.0x 2.0x 5.1x Historical Private Equity M&A Multiples (By Transaction Size) 6.1x 5.6x 8.7x 6.4x 6.5x 6.0x 5.9x 9.2x 7.9x 6.9x 8.6x 7.2x 8.2x 9.0x 10.5x Columbus McKinnon Corporation, a leading designer, manufacturer and marketer of material handling products, acquired Magnetek Inc., a leading designer and manufacturer of digital power and motion control solutions for material handling, elevator, and mining applications, for US$165.4 million. The transaction value represents a multiple of 12.1x EBITDA and 1.5x Revenue. Apax Partners, a global private equity firm, acquired Quality Distribution, Inc., a North American logistics and transportation provider with market leading businesses, for US$801.9 million. The transaction value represents a multiple of 12.6x EBITDA and 0.8x Revenue % 45.7% 13.3% 37.6% Quarterly Equity and Debt Contributions 8.3% 15.6% 39.8% 44.2% 11.9% 46.0% 44.6% 43.9% Equity Sub Debt Senior Debt 0.0x US$10-25M US$25-50M US$50-100M US$ M Q Q Q Q Q Q Q Q

3 Latin America Latin America M&A Sees Increased Activity in Q3: With total deal value at US$30 billion, Q saw a 158.2% increase in deal value from Q There were 408 announced transactions during Q3 2015, representing a 6.8% increase from Q Compared to Q3 2014, deal value decreased by 35.4% while deal volume increased 1.2%. During Q3 2015, the average deal size was approximately US$74 million. The median TEV/EBITDA multiple for disclosed deals during the quarter was 12.4x. Latin America M&A Transactions 2 1 Brazil ^BVSP Mexico ^MXX Argentina ^MERV Chile ^IPSA % -3.8% -15.9% -14.6% -3-4 The most active sectors for M&A deal volume in the region were the Industrial, Consumer Discretionary, and Financial sectors. In Q3 2015, there were a total of four announced transactions with a TEV greater than US$1 billion in Latin America. The Top 3 most active buyers/investors in the region by total transaction value were Banco Bradesco S.A., CM International Holding Pte. Ltd., and Wincon Investment Company Limited Almacenes Éxito S.A., a diversified retail operator in Colombia and internationally, acquired Libertad S.A., and Argentinian operator of hypermarkets, for US$270.0 million. The transaction value represents a multiple of 11.3x EBITDA and 0.5x Revenue. Britvic Plc, a leading soft drinks company with operations in Great Britain, Ireland, and France, acquired Empresa Brasileira de Bebidas e Alimentos S/A, an independent soft drinks company in Brazil, for US$146.1 million. The transaction value represents a multiple of 12.9x EBITDA and 1.3x Revenue. Currency and Interest Rate Performance LTM Currency Market Performance relative to U.S. Dollar Brazil ^BVSP Mexico ^MXX -4 Argentina ^MERV Chile ^IPSA -7.6% -12.5% -23.3% -3.4% month 10-year 3-month 10-year Argentina 22.39%* NA 22.00%* NA Brazil 13.93% 12.00% 10.80% 12.10% Chile 0.48% 4.69% 0.72% 4.78% Mexico 3.31% 6.03% 3.31% 7.75% *New series Selected Short and Long-Term Interest Rates As of June 30, 2015 Current 1 Year Ago

4 Europe M&A Activity Rebounds while Total Deal Value Decreases in Q3: With total deal value at US$328 billion, Q saw a 24.3% decrease in deal value from Q There were 4,956 announced transactions during Q3 2015, representing a 8.3% increase from Q Compared to Q3 2014, deal value increased by 43.7% and deal volume decreased 13.4%. During Q3 2015, the average deal size was approximately US$177 million. The median TEV/EBITDA multiple for disclosed deals during the quarter was 9.8x. $1,800 $1,600 $1,400 $1,200 $1,000 $800 $600 $400 $200 $0 20,159 Europe M&A Transactions 19,360 17,685 17,813 $790 $788 $753 $1,323 14,081 Q3 $328 Q2 $433 Q1 $ Total Value (in US$ billions) Total Volume (# of deals) 24,000 22,000 20,000 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2, England ^FTSE France ^FCHI Germany ^DAXI Russia ^RTSI % -8.8% -8.1% -15.1% The Top 3 most active European buyers/investors in Q by total transaction size were The Kraft Heinz Company, LafargeHolcim Ltd, and CPPIB Credit Investments Inc. In Q3 2015, the Top 3 sectors for European M&A deal volume include the Real Estate, Industrials, and Consumer Discretionary sectors. The most active European buyers/investors in Q by total number of transactions were MMK-Finans Investment Company OOO (10), Bpifrance Investissement (9), and Legal & General Property Limited (9). Currency and Interest Rate Performance LTM Currency Market Performance relative to U.S. Dollar British Pound (GBP) Russian Rouble (RUB) Euro (EUR) Swiss Franc (CHF) -2.6% -3.1% 1.1% -14.5% H.J. Heinz Holding Corporation, an American food processing company, acquired Kraft Foods Group, Inc., a consumer packaged food and beverage company, for US$53.9 billion. The transaction value represents a multiple of 23.8x EBITDA and 3.0x Revenue. International Consolidated Airlines Group, S.A., an Anglo-Spanish multinational airline holding company, acquired Aer Lingus Group DAC, the second-largest airline in Ireland, for US$1.0 billion. The transaction value represents a multiple of 6.7x EBITDA and 0.6x Revenue. Selected Short and Long-Term Interest Rates As of June 30, 2015 Current 1 Year Ago 3-month 10-year 3-month 10-year Britain 0.56% 2.10% 0.55% 2.92% France -0.01% 1.25% 0.21% 1.64% Germany -0.01% 0.89% 0.21% 1.29% Russia 13.60% 10.00% 9.46% 8.53%

5 Asia/Pacific Asian M&A Sees Decreased Activity in Q3: With total deal value at US$169 billion, Q saw a 39.0% decrease in deal value from Q There were 3,353 announced transactions during Q3 2015, representing a 17.4% decrease from Q Compared to Q3 2014, deal value increased by 7.7% while deal volume decreased 11.5%. During Q3 2015, the average deal size was approximately US$108 million. The median TEV/EBITDA multiple for disclosed deals during the quarter was 13.5x. $1,000 $800 $600 $400 $200 $0 12,054 11,673 Asia/Pacific M&A Transactions 12,851 14,759 $629 $582 $590 $728 10,789 Q3 $169 Q2 $278 Q1 $ Total Value (In US$ billions) Total Volume (# of deals) 20,000 15,000 10,000 5, Hong Kong ^HSI Japan ^N225 Korea ^KS11 India ^BSESN % -7.4% -8.6% -19.3% The top Asia/Pacific M&A sectors during Q included Real Estate, Consumer Discretionary, and Industrials. The Top 3 most active regional buyers/investors in the current quarter by number of transactions were Japan Senior Living Investment Corporation (11), Consonant Investment Management Co. Ltd (10), and Invincible Investment Corporation (10). The Top 3 most active regional buyers/investors in Q by total transaction size were SK Holdings Co., Ltd., Samsung C&T Corp., and Bright Real Estate Group. Currency and Interest Rate Performance 1 5.0% -5.0% % -2 LTM Currency Market Performance relative to U.S. Dollar Australian Dollar (AUD) Indian Rupee (INR) Hong Kong Dollar (HKD) Japanese Yen (JPY) -25.0% -2.6% 2.5% 5.1% Cheil Industries Inc., a Korean-based manufacturer of chemicals and electronic materials, acquired Samsung C&T Corporation, a diverse multinational company comprised of the engineering and construction, trading and investment, fashion, and resort businesses, for US$9.9 billion. The transaction value represents a multiple of 16.2x EBITDA and 0.4x Revenue. Hyundai Steel Company, the oldest steel making company in Korea, acquired Hyundai Hysco Co. Ltd., a Korean manufacturer of automotive steel sheet products and various steel pipes, for US$1.8 billion. The transaction value represents a multiple of 5.5x EBITDA and 0.5x Revenue. 3-month 10-year 3-month 10-year Hong Kong 0.39% 1.81% 0.38% 2.11% India 7.62% 7.74% 8.50% 8.66% Japan 0.10% 0.41% 0.13% 0.56% South Korea 1.59% 2.50% 2.64% 3.11% *USD denominated bonds Selected Short and Long-Term Interest Rates As of June 30, 2015 Current 1 Year Ago - 5 -

6 Leadership Team James A. Seale President Brett M. Carmel Senior Managing Director Seale & Associates is a global investment banking firm with extensive experience in mergers and acquisitions (M&A), corporate finance advisory, and enterprise level strategy consulting. Our professionals are trusted advisors maintaining a high level of quality and integrity while presenting innovative ideas and solutions to address our clients most complex dealings. All securities related transactions are cleared through Seale Capital, Inc., an affiliate company, registered broker dealer and FINRA and SIPC member. Robert E. Whitney Managing Director rwhitney@sealeassociates.com Felipe Bueno Viesca Managing Director Latin America fbueno@sealeassociates.com Martin B. Cohen mcohen@sealeassociates.com Henry W. Levine hlevine@sealeassociates.com Paul Roessel proessel@sealeassociates.com John Schauss jschauss@sealeassociates.com Seale & Associates, Inc. 950 N. Glebe Rd. Suite 950 Arlington, Virginia United States Phone: +1 (703) Fax: +1 (703) Washington, D.C Mexico City, Mexico