MergerMarket Group recently published its January edition of Monthly M&A Insider which reported on mergers and acquisitions activity around the world during the second half of 2014. Among other things, the report explains why 2014 was so hospitable to M&A activity, citing an improving economy, large cash reserves, low interest rates, and cheap financing as contributing factors.
Overall, there were 16,588 reported deals in the second half of 2014 worldwide, worth roughly $3.2 trillion; this surpasses the previous record, in the second half of 2007, of 16,060 transactions, worth roughly $3.7 trillion. Just under half of the total value of transactions were based in North America, with one-quarter based in Europe. In terms of volume, one-third of deals were based in North America, roughly two-fifths of deals were based in Europe, and just under one-quarter were based in Asia. The industries with the highest value of deals were, in order, Energy, Mining & Utilities (24.2%), Consumer (12.2%), and Industrials & Chemicals (12.0%). The industries with the highest volume were, Industrials & Chemicals (19.1%), Business Services (13.2%), and Consumer and Technology (tied, 11.8%).
M&A in North America
With respect to North American markets, the Industrials & Chemicals sector was the most active participant in M&A transactions, with 432 deals worth $92.6 billion, but the Energy, Mining & Utilities industry had the highest value, with 353 deals worth $248 billion. The biggest gains were seen in the Leisure industry, with a year-over-year increase of 302% (from $9 billion to $36 billion); the greatest decline was in Telecommunications, from $137.2 billion to $10.6 billion.
In the private equity space, there were 2,099 transactions globally worth $489.6 billion, easily surpassing the 2007 high of 1,794 deals worth $403 million. In terms of the highest value of exits, the top three firms were Blackstone Group ($8,100 million, with 1 deal), Apollo Global Management ($6,631 million, with 3 deals), and Thomas H. Lee Partner ($4,000 million, with 1 deal).