Issue 4 2019

Acquisition International - Issue 4 2019 73 Number and Aggregate Value (mil USD) of M&A Deals Globally: 2006-2019 YTD (as at 31st March 2019) Deal quarterly value (Announced date) Number of deals Aggregate deal value (mil $) Q1 2019 20,966 1,144,673 Q4 2018 25,833 1,142,365 Q3 2018 24,845 1,206,119 Q2 2018 27,253 1,514,259 Q1 2018 26,753 1,513,173 Q4 2017 27,932 1,358,245 Q3 2017 25,556 1,127,827 Q2 2017 26,363 1,182,758 Q1 2017 26,052 1,168,658 Q4 2016 26,809 1,409,338 Q3 2016 25,817 1,306,148 Q2 2016 26,234 1,105,572 Q1 2016 27,732 1,018,340 Q4 2015 28,199 1,548,683 Q3 2015 28,254 1,453,482 Q2 2015 28,974 1,547,658 Q1 2015 25,325 1,326,174 Q4 2014 27,022 1,254,464 Q3 2014 26,228 1,239,305 Q2 2014 25,192 1,383,905 Q1 2014 24,882 934,834 Q4 2013 26,262 965,095 World region (target) Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Far East and Central Asia 7,986 8,368 8,045 8,732 6,251 Western Europe 7,899 8,101 7,612 8,166 6,163 North America 6,240 6,114 5,352 5,209 5,391 Eastern Europe 2,371 2,192 1,471 1,260 1,259 Oceania 1,080 1,208 1,321 1,200 813 South and Central America 644 676 620 717 581 Middle East 221 220 159 206 284 Africa 298 320 243 327 218 Number of M&A Deals by Region: 2016 - 2019 YTD (as at 31st March 2019) Bureau van Dijk Mergers and acquisitions (M&A) targeting companies operating in the industrials sector in Q1 2019 totalled 4,758 deals worth an aggregate USD 282,580 million and accounted for 22 and 25 per cent of the quarter’s global M&A volume and value, respectively, according to Zephyr, the M&A database published by Bureau van Dijk. The decline in volume was pronounced as aggregate dealmaking announced over the quarter was the lowest recorded in five years, since Q1 2014 (4,698) in fact. The value of M&A in Q1 represented a decline on Q4 2018 and Q1 2018, when deals worth an aggregate USD 318,908 million and USD 332,496 million, respectively, were announced. However, it should be noted that Q1 for the industrials sector is, generally, a relatively quiet period. The quarter-on-quarter and year-on-year decline came despite one deal in Q1 exceeding USD 50,000 million, and which was also one of the top 20 deals by value announced globally since records began: Saudi Aramco has signed a share purchase agreement to acquire a 70 per cent stake in Saudi Basic Industries Corporation (SABIC) for USD 69,100 million. This was by far and away the largest industrials M&A deal of the quarter as the second-biggest deal was only worth USD 7,000 million: ZF Friedrichshafen announced plans to acquire US auto parts manufacturer Wabco Holdings to expand its trucks and driver-assistance systems, just one month after confirming the talks with its North American peer. An Israel target was next as NVIDIA is involved in a recommended takeover of Mellanox Technologies for USD 6,900 million. Surprisingly enough, the Middle East was not the top targeted region by value, in spite of the SABIC deal accounting for almost a quarter of the overall sector’s quarterly value. Companies based in the Far East and Central Asia were targeted in 1,743 deals worth a total USD 91,981 million while only 78 deals aggregating at USD 78,630 million targeted the Middle East. Western Europe was second by volume and third by value. In conclusion, Q1 may have been a relatively quiet start of the year for M&A targeting the industrials sector when compared to Q1 2018, but the take-away is that acquirors are not shunning high-value investments, as can be seen by the SABIC deal, not to mention that all of Q1’s top deals by value surpassed USD 1,000 million. Industrials Number of M&A Deals Globally by Target Sector: 2016 - 2019 to date (as at 31st March 2019) Number and Aggregate Value (mil USD) of M&A Deals Globally: 2006-2019 YTD (as at 31st March 2019) Deal yearly value (Announced date) Number of deals Aggregate deal value (m USD) 2019 20,966 1,144,673 2018 104,684 5,375,916 2017 105,903 4,837,488 2016 106,592 4,839,397 2015 110,752 5,875,997 2014 103,324 4,812,508 2013 93,112 3,707,653 Major sector (target) Q4 2018 Q1 2019 Other services 9,441 7,902 Machinery, equip- ment, furniture, recycling 3,161 2,185 Wholesale & retail trade 1,627 1,304 Chemicals, rubber, plastics, non-metal- lic products 1,467 1,075 Publishing, printing 1,077 924 Metals & metal products 1,102 827 Construction 1,056 712 Primary Sector (agriculture, mining, etc.) 707 481 Banks 505 432 Food, beverages, tobacco 536 423 Gas, Water, Elec- tricity 581 420 Transport 468 347 Education, Health 408 333 Post and telecom- munications 274 328 Insurance companies 334 292 Hotels & restau- rants 359 290 Textiles, wearing apparel, leather 273 205 Wood, cork, paper 197 135