Global Mergers & Acquisitions Update

Transcription

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

2 United States US M&A Deal Value Declines while Volume Increases During Q1 2017: With total deal value at US$293 billion, Q saw a 46.8% decrease in deal value from Q There were 4,915 announced transactions during Q1 2017, representing a 6.1% increase from Q Compared to Q1 2016, deal value decreased by 43.1% and deal volume increased 2.4%. During Q1 2017, the average deal size was approximately US$165 million. The median TEV/EBITDA multiple of disclosed deals during the quarter was 12.9x. U.S. M&A Transactions 8.9% 3.9% 4.7% Middle-market private equity reported deals TEV/EBITDA multiples averaged 6.7x for TEVs between US$ million. Equity contribution for reported middle-market private equity M&A deal funding decreased in Q to 43.9%, down from 48.6% in Q Deals involving better performers (TTM EBITDA margins and revenue growth rates both above 10%) accounted for 52% of reported activity during Q1 2017, below the historical average of 57%. Private Equity-Sponsored M&A Activity Historical Private Equity M&A Multiples (By Transaction Size) Samsung Electronics America, Inc., a recognized innovation leader in consumer electronics design and technology, acquired Harman International Industries, Incorporated, a global leader in connected car technology, lifestyle audio innovations, design and analytics, cloud services, and IoT solutions, for US$8.7 billion. The transaction value represents a multiple of 10.1x EBITDA and 1.2x Revenue. Technip SA, a company that provides project management, engineering, and construction services for the energy industry, acquired FMC Technologies, Inc., a global leader for the energy industry providing oil service equipment, for US$9.2 billion. The transaction value represents a multiple of 17.8x EBITDA and 1.9x Revenue. Quarterly Equity and Debt Contributions - 2 -

3 Latin America Latin American M&A Deal Value Increases while Volume Decreases during Q1 2017: With total deal value at US$32 billion, Q saw a 34.4% increase in deal value from Q There were 322 announced transactions during Q1 2017, representing a 10.8% decrease from Q Compared to Q1 2016, deal value increased by 144.1% and deal volume decreased 5.6%. During Q1 2017, the average deal size was approximately US$246 million. The median TEV/EBITDA multiple of disclosed deals during the quarter was 10.3x. $2,100 $1,800 $1,500 $1,200 $900 $600 $300 $0 18,130 $1,024 19,314 $1,370 20,098 20,821 $1,935 $2,026 9,540 Q2 $507 Q1 $ Total Value (in US$ billions) Latin America M&A Transactions Total Volume (# of deals) The most active sectors for M&A deal volume in the region were the Materials, Consumer Discretionary, and Industrials sectors. In Q1 2017, there were a total of two 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 Vale S.A., State Grid Brazil Power Participações Ltda., and Bavaria S.A. Currency and Interest Rate Performance LTM Currency Market Performance relative to U.S. Dollar 24,000 21,000 18,000 15,000 12,000 9,000 6,000 3, % 9.1% 15.9% American Industrial Partners, a North American based middle-market private equity firm, acquired Moly-Cop Adesur S.A., a Peruvian-based manufacturer of grinding steel balls and rods used in the mining industry, for US$1.2 billion. The transaction value represents a multiple of 7.9x EBITDA and 1.2x Revenue. State Grid Brazil Power Participações Ltda., an electricity distributor based in Brazil, acquired a 54.6% stake in CPFL Energia S.A., the largest non state-owned group of electric energy generation and distribution companies in Brazil, for US$12.0 billion. The transaction value represents a multiple of 10.3x EBITDA and 2.3x Revenue. 7.3% 5.2% 0.0% 3.5% 10.8% - 3 -

4 Europe M&A Activity Decreases while Total Deal Value Increases During Q1 2017: With quarterly deal value totaling US$437 billion, Q saw a 29.4% increase in deal value from Q There were 5,133 announced transactions during Q1 2017, representing a 2.0% decrease from Q Compared to Q1 2016, deal value nearly doubled, realizing a 98.7% surge, while deal volume increased 2.3%. During Q1 2017, the average deal size was approximately US$343 million. The median TEV/EBITDA multiple for disclosed deals during the quarter was 12.3x. Europe M&A Transactions 35.0% 25.0% 15.0% 5.0% England ^FTSE France ^FCHI Germany ^DAXI Russia ^RTSI -4.4% 2.1% 4.0% 5.1% -5.0% -15.0% -25.0% -35.0% M A M J J A S O N D The Top 3 most active buyers/investors in Europe during Q by total transaction size were The Kraft Heinz Company, PPG Industries, Inc., and Johnson & Johnson. The most active sectors for M&A deal volume in the region were the Real Estate, Industrials, and Consumer Discretionary sectors. The most active buyers/investors in Europe during Q by total number of transactions were M7 Real Estate LLP (10), Real I.S. AG (10), and Catella Real Estate AG (9). Atotech B.V., a Dutch manufacturer of graphite lubricants, was acquired by American private equity firm The Carlyle Group, for US$3.2 billion. The transaction value represented a multiple of 11.9x EBITDA and 3.2x Revenue. Sumitomo Corporation, a leading integrated trading company engaged in diverse businesses based on its global network, purchased Fyffes plc, an Irish fruit and fresh produce company, for US$907.4 million. The transaction value represents a multiple of 15.3x EBITDA and 0.8x Revenue. Currency and Interest Rate Performance LTM Currency Market Performance relative to U.S. Dollar 9.2% 2.1% 1.7% 2.2% Selected Short and Long-Term Interest Selected Short and Long-Term Interest Rates Rates As of June 30, month 10-year 3-month 10-year Britain 0.34% 1.28% 0.57% 1.54% France -0.33% 0.99% -0.24% 0.48% Germany -0.33% 0.31% -0.24% 0.16% Russia 11.28% 8.27% 12.25% 9.09% *USD denominated bonds Current 1 Year Ago - 4 -

5 Asia/Pacific Asian M&A Activity and Total Deal Value Decline in Q1 2017: With total deal value at US$223 billion, Q saw a 13.8% decrease in deal value from Q There were 3,704 announced transactions during Q1 2017, representing a 15.4% decrease from Q Compared to Q1 2016, deal value increased by 36.8% and deal volume increased by 3.6%. During Q1 2017, the average deal size was approximately US$96 million. The median TEV/EBITDA multiple for disclosed deals during the quarter was 13.8x. Asia/Pacific M&A Transactions 11.7% 12.7% -1.1% 6.3% The top Asia/Pacific M&A sectors during Q included Information Technology, Industrials and Consumer Discretionary. The Top 3 most active buyers/investors in the current quarter by number of transactions were Matrix Partners China (18), 500 Startups (16), and SMBC Venture Capital Co. Ltd (14). The Top 3 most active regional buyers/investors in Q by total transaction size were China Development Bank Corporation., Sino IC Capital Co. Ltd. and IS DongSeo Co. Ltd. Currency and Interest Rate Performance LTM Currency Market Performance relative to U.S. Dollar PAG Asia Capital, the private equity arm of PAG, acquired Yingde Gases Group Company Limited, a company that produces, supplies, and distributes various industrial gas products, for US$3.1 billion. The transaction value represents a multiple of 7.3x EBITDA and 2.4x Revenue. KKR & Co. L.P, a private equity and real estate investment firm specializing in direct and fund of fund investments, acquired Hitachi Koki Co. Ltd., a company that manufactures and sells power tools and life-science instruments, for US$1.1 billion. The transaction value represents a multiple of 13.0x EBITDA and 0.8x Revenue. -0.7% 0.0% -0.5% -2.6% - 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 Sergio Garcia del Bosque Managing Director sgarcia@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