According to MergerMarket's Monthly M&A Insider
Report, global M&A activity continued to wane throughout
May 2016, maintaining the trend
reported on earlier this year. May 2016 resulted in a total of
1,054 deals worth an aggregate of US$224.5 billion, down from the
1,410 deals valued at US$372.5 billion in May 2015. Energy, Mining
& Utilities, the sector with the strongest showing, lead with
80 deals worth US$40.5 billion, representing a 66.8% increase in
value (but a 17% drop in the number) from deals in this sector in
The report highlighted the following regarding global M&A
The 350 North American deals in May 2016 were worth an
aggregate of US$108 billion, representing a 49.4% decrease in value
compared to May 2015. The Business Services sector led the way with
48 deals valued at US$31.0 billion, representing a 400.1% increase
in value from the same period in 2015. The sharp decline in
cross-border M&A (which saw an 80.4% decrease in in-bound
activity as compared to May 2015), however, indicate that 2016 is
on pace to be the lowest-value year for M&A activity in North
America since 2013.
M&A activity in Central & South America continues to
struggle. Energy, Mining and Utilities was the top performing
sector in this region, with three deals valued at $1 billion
(representing a decrease of 27.1% from May 2015). Earlier this
we reported on the political turmoil and faltering economy in
Brazil that have helped depress M&A activity in this country,
ordinarily a top performing economy in the Latin American region.
These factors, in addition to worldwide commodity prices and
currency devaluations, continue to influence M&A activity in
Brazil and negatively impact the region as a whole, and foreign
investments in particular, where in-bound activity fell 99.5% from
May 2015 levels.
The decline of M&A activity in Europe in May 2016 was not
as steep compared to other regions around the world. May 2016
resulted in 377 deals worth US$44.3 billion, representing a
decrease of 4.7% in value from the same period in 2015. In-bound
interest and investments from Chinese firms continued to be strong.
The top performing sector, Industrial and Chemicals, lead the way
with 89 deals valued at US$10.2 billion, one of the largest of
which was the acquisition of robotics maker KUKA AG by Midea (a
Chinese-based manufacturer). The high levels of interest from
Chinese investors in German automation, semiconductor and chemical
companies is expected to continue throughout 2016.
Deal value in the Middle East and Africa peaked in May 2016
with 20 deals valued at US$4.4 billion, representing a 127%
increase in value from May 2015. The four deals in the Energy,
Mining and Utilities sector had a combined value of US $4.0 billion
(an 806.5% increase from May 2015) and it is predicted that the oil
and gas and gold spaces in this region will continue to attract
interest throughout 2016.
In Asia-Pacific (excluding Japan), a total of 234 deals with a
value of $52.6 billion was announced, representing a 45.3% decrease
in value from May 2015. China was the top-performing country in
this region, accounting for 112 transactions worth US$35.7 billion.
Japan had a strong beginning to the year, however, where the 168
deals valued at US$29.8 billion represented a 67.2% increase year
to date from the same point in May 2015.
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