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Monthly M&A InsIderA mergermArket report on globAl m&A Activity
AUgUSt 2010
Monthly M&A InsIdermergermarket
GlobAl overvIew 01
AmericAS: lAtin AmericA 05
north AmericA 12
ASiA-pAcific 23
eUrope 34
middle eASt & AfricA 46
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CONTENTS
Monthly M&A Insider
global overview
01
global overview
Head of Research – elias latsis
Editor – rory McNeil
For advertising opportunities contact:
Erik Wickman
Tel: + (1) 212 6863329
Global overview: Tom Coughlan
Latin America: Mathew albert
North America: Jason Cozza
Asia-Pacific: Shunsuke okano and anita wong
Europe: Samuel Tedjasukmana and Damien Julliard
Middle East & Africa: Marie-laure Keyrouz and lars lundqvist
The top deal was announced in the Canadian industrials & Chemicals space with bHP billiton launching a US$41.91bn hostile takeover bid for Potash Corporation of Saskatchewan, the world’s largest fertiliser company by capacity. The outcome of the situation is uncertain after Potash’s board rejected bHP’s US$130.00 per share offer, claiming that it undervalues the company and does not reflect its future growth prospects. while bHP still has to convince Potash shareholders and Canadian antitrust regulators over the merits of the deal, the proposed tie-up would accelerate bHP’s entry into the fertiliser industry. Furthermore, Potash’s mining operations are thought to be a natural fit with the australian mining giant’s existing greenfield holdings in Saskatchewan.
interestingly, bHP’s bid for Potash is indicative of a wider trend that has seen a number of hostile offers announced in recent weeks. The european M&a market is also witnessing another ongoing high profile situation after Korea National oil Corporation moved to make a US$2.92bn bid for Dana Petroleum, the UK-based oil and gas exploration and production company. in total, a remarkable eight hostile bids have come to the market since the beginning of July, carrying an aggregate disclosed valuation figure of US$48.90bn. Put into context, the preceding 6 months of 2010 witnessed just 19 hostile situations, illustrating to good effect the recent marked uptick in activity.
outside of the corporate M&a sphere, it is also telling that private equity houses have also been busying themselves over the summer break. after months of predominantly scouring targets in the mid-market space, it seems that financial investors are increasingly eager to target sizeable firms in the public arena. indeed, four of the top five take privates of 2010 have been announced in July and august with all major regional M&a markets witnessing significant transactions, driven exclusively by North american investors on the buy-side.
Casting an eye to specific individual transactions, the largest take private deal currently stands as blackstone group’s US$4.85bn acquisition of Dynergy, the US-based provider of wholesale power, capacity and ancillary services. elsewhere, in a deal valued at US$4.77bn, the european market saw onex Partners and Canadian Pension Plan investment board take private UK engineering firm Tomkins. US private equity heavyweights Carlyle group and TPg Capital have also been acquisitive in recent weeks with the firms acquiring Healthscope, the listed australia-based hospitals operator, via a cash scheme of arrangement. valued at US$2.35bn, the deal stands as the largest private equity buyout announced in the asia-Pacific region so far in 2010.
by Tom Coughlan, Remark, The Mergermarket Group
GLobAL ovERvIEW
THe ToP eND oF THe global M&a MarKeT HaS SeeN SigNiFiCaNT aCTiviTy iN reCeNT weeKS wiTH a NUMber oF HigH ProFile TraNSaCTioNS aNNoUNCeD. NoTably, Two oF THe THree largeST DealS oF 2010 Have CoMe To MarKeT SiNCe THe begiNNiNg oF JUly, iNDiCaTiNg THaT CaSH-riCH CorPoraTe aND PrivaTe eqUiTy bUyerS Feel iNCreaSiNgly well PlaCeD To MaKe a reTUrN To broKeriNg large-CaP M&a.
Monthly M&A Insider 02
globAl overvieW
TrEND graPHS
GlobAl M&A quArterly trend
valUE vOlUME
0
200,000
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600,000
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1,000,000
1,200,000
1,400,000
Q310*
Q210
Q110
Q409
Q309
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q207
Q107
Q406
Q306
Q206
Q106
Q405
Q305
Q205
Q105
Q404
Q304
Q204
Q104
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e (U
S$m
)
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1,000
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3,500
4,000
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Q210
Q110
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Q309
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q207
Q107
Q406
Q306
Q206
Q106
Q405
Q305
Q205
Q105
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Q304
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Q104
Volu
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GlobAl M&A quArterly MId-MArket trend
valUE vOlUME
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Q110
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Q309
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q207
Q107
Q406
Q306
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Q106
Q405
Q305
Q205
Q105
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Q304
Q204
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e (U
S$m
)
0
500
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1,500
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Q210
Q110
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Q309
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Q307
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Q106
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Num
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of d
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Moving average trend line
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GlobAl M&A seCtor breAkdown ytd 2010
valUE vOlUME
9.4%
6.4%
16.9%
11.4%
3.2%
1.4%
1.8%
1.0%0.5%3.3%
10.7%
23.6%
10.4%
Industrials & Chemicals
TMT
Consumer
Business Services
Energy, Mining & Utilities
Financial Services
Pharma, Medical & Biotech
Construction
Leisure
Transportation
Real Estate
Agriculture
Defence
Industrials & Chemicals
TMT
Consumer
Business Services
Energy, Mining & Utilities
Financial Services
Pharma, Medical & Biotech
Construction
Leisure
Transportation
Real Estate
Agriculture
Defence
12.3%
14.9%
18.0%
4.1%
3.5%
2.2%
2.9%
0.5%1.3%
10.8%
10.6%
11.4%
7.5%
GlobAl M&A quArterly PrIvAte equIty trend
valUE vOlUME
0
50,000
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Q310*
Q210
Q110
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Q306
Q206
Q106
Q405
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e (U
S$m
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Global buyouts
Global exits
0
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Num
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of d
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Global buyouts
Global exits
Monthly M&A Insider 04
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TrEND graPHS
GlobAl M&A deAl sIze breAkdown
valUE vOlUME
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H22010*
H12010
H22009
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H22008
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H22007
H12007
H22006
H12006
H22005
H12005
H22004
H12004
> US$501m
US$251m-US$500m
US$101m-US$250m
US$15m-US$100m
US$5m-US$14.9m
Valu
e (U
S$bn
)
0
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H12010
H22009
H12009
H22008
H12008
H22007
H12007
H22006
H12006
H22005
H12005
H22004
H12004
> US$501m
US$251m-US$500m
US$101m-US$250m
US$15m-US$100m
US$5m-US$14.9m
Value not disclosed
Num
ber
of d
eals
LATIN AM
ERICA
LATIN AMERICAA MERgERMARkET M&A REpoRT oN
Monthly M&A Insider 05
Months of tough negotiations and even threats of arbitration to dissolve the JV ended when the portuguese government – which enjoys de facto veto power over such plays as a bearer of golden shares in pT – finally relented, allowing the telco to accept Telefónica’s revised bid of US$9.75bn. While the portuguese government blocked the deal on the grounds the asset and presence in the Brazilian market was strategically important for pT, company shareholders were not so averse to accepting the handsomely priced bid, which is almost a third higher than the initial offer price in May and roughly 11 times expected EBITDA.
Telefónica, the largest telco by market capitalisation in the Eurozone, will now move to buyout Vivo’s minority free float shareholders and integrate the mobile operator with Telesp, Telefónica’s fixed line business headquartered in São paulo. The merger will grant Telefónica ‘undisputed leadership of the Brazilian telecommunications markets,’ according to a press release by the firm.
Clearly, such a feat has not gone unnoticed by pT. The company is moving straight back into the dealmaking fray with a US$4.80bn investment for a 22.40% stake in oi, another leading Brazilian telco. According to mergermarket intelligence, oi may use proceeds from the sale to expand its presence elsewhere in Latin America.
It is not surprising that Telefónica and pT are set on staying in the region. Latin America has been a hot spot for overseas investors eager to offset languid business activity in home markets blighted by recession and sluggish recoveries. For instance, Banco Santander struck such a deal with Bank of America in June to acquire the 24.90% stake in Mexico-based grupo Financiero for US$2.50bn not already owned by the Spanish banking group.
Brazil, especially, has been a key investment destination for buyers sourcing transactions in the region. The country has an amazing growth story – gDp is expected to grow by some 7.0% in 2010 – and its long-term prospects make it strategically important for multinational corporate groups such as Telefónica to gain a presence. And with large-scale investments needed to gain a sizable foothold in the market, prospects for deal flow in the large-cap transaction space remain bright.
IN JULy, ThE LATIN AMERICAN M&A MARkET SAW oNE oF ThE MoST FRAUghT AND DRAWN-oUT DEALS oF RECENT TIMES WRAppED Up. ThE TRANSACTIoN, ThE SECoND LARgEST BRokERED IN ThE REgIoN ThIS yEAR, SAW SpANISh TELECoMS gIANT TELEFóNICA BRokER A DEAL To ACqUIRE poRTUgAL TELECoM’S (pT) 50.00% STAkE IN JoINT VENTURE BRASILCEL, A hoLDINg CoMpANy WITh A CoNTRoLLINg INTEREST IN BRAzIL’S LARgEST WIRELESS opERAToR VIVo.
06
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ERICA
Monthly M&A Insider
Target: Brasilcel NV (50.00% stake) Announced: 28-Jul-10
Bidder: Telefonica SA Deal value: US$9.75bn
Seller: portugal Telecom SgpS SA Deal nature: Acquisition, Cross-border, private
STRUCTURE• Telefonica, S.A. has signed a definitive agreement to
acquire a 50.00% stake in Brasilcel, N.V. from portugal Telecom, SgpS, S.A.
• Brasilcel, N.V., the Netherlands-based company headquartered in Amsterdam, is a holding company and a provider of telecommunications services with a special focus on the Brazilian market.
• portugal Telecom, SgpS, S.A., the listed portugal-based company headquartered in Lisbon, is a global telecommunications company engaged in fixed-line and mobile telephone services, as well as in data and multimedia services.
TERMS
• This transaction has an implied equity value of €15.00bn.
• of the purchase price, €4.50bn will be paid on closing, €1.00bn will be paid on 30 December 2010 and the remaining €2.50bn will be paid no later than 31 october 2011.
• The net present value of the consideration is €7.30bn.
• The acquired 50.00% stake in Brasilcel brings Telefonica’s total stake holding in the target company to 100.00%.
• Telefonica is to pay portugal Telecom a total consideration of €7.50bn for the 50.00% stake in Brasilcel.
RATIONALE
• This acquisition is in line with Telefonica’s strategy to obtain a leadership position in the telecommunications market in Brazil.
• Telefonica plans to combine Vivo participacoes, S.A., the listed Brazil-based provider of cellular telecommunications services, which is approximately 60.00% owned by Brasilcel (directly or indirectly), with Telesp, the Brazil-based telecommunications company, which is owned by Telefonica.
• This will create the largest integrated operator in Brazil by the number of customers and turnover.
CONDITIONS
• Regulatory approval in Brazil.
EXPECTED COMPLETION
• The transaction is expected to close within the next 60 days.
DEAL oF ThE MoNTh
Advisers
Target/Seller Bidder
Financial Morgan StanleyBanco Espirito Santo de InvestimentoBank of America Merrill Lynch
Financial SgUBS Investment Bank
Financial Skadden Arps Slate Meagher & Flomgarrigueshouthoff Buruma
Legal Uria MendendezDe Brauw Blackstone WestbroekCuatrescasas, goncalves pereira
mergermarket/dealReporter Intelligence
28-Jul-10 pT/Vivo: No extraordinary dividend seen in the short-term
27-Jul-10 portugal Telecom needs to materialise cross-shareholding deal with oi before it can revisit Vivo deal with Telefonica
22-Jul-10 pT should sell Vivo to prevent hostile bid, shareholder says
21-Jul-10 Vivo: TEF could acquire control after Brasilcel dissolution - analysis
16-Jul-10 Vivo: Telefonica deadline extension possible pending talks
15-Jul-10 Vivo: portugal wants pT to stay in Brazil; TI stake offered
8-Jul-10 Vivo: Neither party pushing for new EgM
07
LATIN AM
ERICA
Monthly M&A Insider
TOP 15 LATIN AMERICAN ANNOUNCED DEALS YTD 31 JULY 2010Announced Status Target company Sector Bidder company Seller company Exit multiples (x) Bid premia
1-day beforeDeal value
(US$m)Revenue EBITDA P/E
13-Jan-10 C Carso global Telecom SAB de CV
TMT America Movil SA de CV 1.7 4.9 14.4 3.1% 28,055
28-Jul-10 p Barsilcel NV (50.00% stake)
TMT Telefonica SA portugal Telecom SgpS SA
- 9,746
11-Jan-10 C FEMSA Cerveza SA de CV
Consumer heineken NV Fomento Economico Mexicano SAB de CV
- 7,692
13-Jan-10 C Telmex Internacional SAB de CV (39.30% stake)
TMT America Movil SA de CV 2.6 10.6 23.6 2.2% 6,533
2-May-10 p Alumina do Norte do Brasil SA (57.00% stake); Aluminio Brasileiro SA (51.00% stake); Companhia de Alumina do para (61.00% stake); and paragominas bauxite mine (60.00% stake)
Industrials & Chemicals
Norsk hydro ASA Vale SA - 4,900
22-Jan-10 C polibutenos SA Industrias quimicas (33.33% stake); quattor participacoes SA (60.00% stake); and Unipar Comercial e Distribuidora SA
Industrials & Chemicals
Braskem SA Uniao de Industrias petroquimicas SA
- 4,238
27-Jan-10 C Bunge participacoes e Investimentos SA
Industrials & Chemicals
Vale SA Bunge Limited - 3,800
14-Mar-10 p Bridas Corporation (50.00% stake)
Energy, Mining & Utilities
CNooC International Limited
Bridas Energy holdings Ltd
- 3,100
9-Jun-10 p grupo Financiero Financial Services
Banco Santander Bank of America Corporation
n/a n/a n/a - 2,500
3-May-10 p Agre Empreendimentos Imobiliarios SA
Real Estate pDg Realty SA Empreendimentos e participacoes
n/a n/a 13.8 1.5% 1,955
15-Jul-10 p BAC Credomatic gECF
Financial Services
grupo Aval Acciones y Valores SA
gE Capital global Banking
n/a n/a n/a - 1,900
10-Feb-10 C Fertilizantes Fosfatados SA (36.79% stake)
Industrials & Chemicals
Vale SA The Mosaic Company; and yara Brasil Fertilizantes SA
7.2 - 1,834
18-May-10 p plena Transmissoras SA (Seven Brazilian transmission companies)
Energy, Mining & Utilities
State grid Corporation of China
plena Transmissoras SA
- 1,721
15-Feb-10 p Comunicaciones Nextel de Mexico SA de CV (30.00% stake)
TMT grupo Televisa SA de CV NII holdings Inc - 1,440
18-May-10 p Itau Unibanco holding SA (2.50% stake)
Financial Services
Itausa - Investimentos Itau SA
Bank of America Corporation
n/a n/a 15.0 27.7% 1,115
C = Completed; p = pending; L = Lapsed Source: mergermarket
Top DEALS & ExpECTED DEALS
LATIN AM
ERICA
Monthly M&A Insider 08
Top DEALS & ExpECTED DEALS
TOP 5 LATIN AMERICAN ANNOUNCED DEALS OF ThE MONTh (JULY 2010)Announced Status Target company Sector Bidder company Seller company Exit multiples (x) Bid premia
1-day beforeDeal value
(US$m)Revenue EBITDA P/E
28-Jul-10 p Barsilcel NV (50.00% stake)
TMT Telefonica SA portugal Telecom SgpS SA
- 9,746
15-Jul-10 p BAC Credomatic gECF Inc
Financial Services
grupo Aval Acciones y Valores S.A
gE Capital global Banking
n/a n/a n/a - 1,900
22-Jul-10 p Sistema Educacional Brasileiro SA (Learning systems division)
Business Services
pearson plc Sistema Educacional Brasileiro SA (Shareholders)
- 498
19-Jul-10 C Lojas Maia Ltda Consumer Magazine Luiza SA 0.5 - 164
29-Jul-10 p Medidata Informatica SA (79.70% stake)
TMT eLandia International Inc Amper SA - 66
C = Completed; p = pending; L = Lapsed Source: mergermarket
PIPELINE OF EXPECTED DEALS Situation Target
companySector Potential bidder
companyFinancial adviser to bidder (B); target (T); seller (S)
Seller company Market cap/ est. value (US$m)
Comments
Auction Aguas Nuevas
Energy, Mining & Utilities
Macquarie Capital, Morgan Stanley Infrastructure or Marubeni
Banco Santander US$350m Banco Santander is negotiating with a few buyers on the sale of Aguas Nuevas, the Chilean utility, and it is close to sealing a deal, said a source close to the situation. In February, Banco Santander sent out an information memorandum on Aguas Nuevas and bids were expected the following month, as previously reported by this news service. Likely buyers are infrastructure funds such as Macquarie Capital and Morgan Stanley Infrastructure, as also previously reported. A published report in December 2009 tagged Japanese conglomerate Marubeni as a potential buyer. The source could not comment on a potential deal value, but it has been reported that Aguas Nuevas could be worth US$350m. The utility has 356,000 customers and an 8.8% share of the Chilean water market. Santander Infrastructure Fund II, which specialises in infrastructure assets, acquired the Chilean utility last year from grupo Solari.
Rumoured takeover target
Express de Santiago Uno
Transportation grupo Rios US$34m (target revenue)
It was reported that grupo Rios, the Colombia-based conglomerate, is in talks to acquire Chilean mass transportation company Express de Santiago Uno. According to the article, sources say grupo Rios is currently restructuring the conglomerate's management and is preparing a strategy to spur growth in Chile through acquisitions. It also states that the group is already in advanced negotiations and, following the deal, may seek to merge Express de Santiago Uno with Alsacia, its mass transportation subsidiary Express Santiago Uno, the operator of the Troncal 4 bus line, which has annual revenues of US$34m.
Expected deals based on confirmed announcements by companies involved
09
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ERICA
Monthly M&A Insider
LEAgUE TABLES
VALUEYTD
31-Jul-10house Value
(US$m)Deal count
1 Credit Suisse 59,211 22
2 Citigroup 48,690 7
3 Bank of America Merrill Lynch 23,728 13
4 Morgan Stanley 16,111 6
5 UBS Investment Bank 10,768 7
6 Banco Espirito Santo de Investimento 9,836 3
7 Sg 9,746 1
8 Rothschild 9,761 8
9 Allen & Company 9,132 2
10 Jp Morgan 8,343 9
11 Deutsche Bank 6,855 6
12 Santander global Banking and Markets 4,338 4
13 Banco Bradesco 4,254 3
14 goldman Sachs 3,209 5
15 hopu Investment Management Co 3,100 1Source: mergermarket
VoLUME
The financial advisor league tables by value and volume have been run from 1 January 2010 to 31 July 2010 and exclude lapsed and withdrawn deals. The tables cover all sectors andare based on the geography of either the target, bidder or seller being Latin American-based.
YTD 31-Jul-10
house Value (US$m)
Deal count
1 Credit Suisse 59,211 22
2 Bank of America Merrill Lynch 23,728 13
3 JpMorgan 8,343 9
4 Rothschild 9,671 8
5 Citigroup 48,690 7
6 UBS Investment Bank 10,768 7
7 Morgan Stanley 16,111 6
8 Deutsche Bank 6,855 6
9 goldman Sachs 3,209 5
10 hSBC Bank 2,576 5
11 Crdit Agricole CIB 1,916 5
12 Santander global Banking and Markets 4,338 4
13 Lazard 1,715 4
14 patria-Banco de Negocios 1,049 4
15 Banco Espirito Santo de Investimento 9,836 3Source: mergermarket
TOP 15 FINANCIAL ADVISORS – LATIN AMERICA
VALUEYTD
31-Jul-10house Value
(US$m)Deal count
1 Dewey & LeBoeuf 34,628 3
2 Skadden Arps Slate Meagher & Flom 18,938 7
3 Allen & overy 14,742 3
4 Cleary gottlieb Steen & hamilton 14,567 6
5 Freshfields Bruckhaus Deringer 12,592 2
6 Uria Menendez 11,548 6
7 Cuatrecasas, goncalves pereira 9,746 3
8 De Brauw Blackstone Westbroek 9,746 1
9 garrigues 9,746 1
10 houthoff Buruma 9,746 1
11 Simpson Thacher & Bartlett 9,495 6
12 gibson Dunn & Crutcher 8,321 3
13 Davis polk & Wardwell 8,300 5
14 Loyens & Loeff 7,692 1
15 Latham & Watkins 6,800 4Source: mergermarket
VoLUME
The legal advisor league tables by value and volume have been run from 1 January 2010 to 31 July 2010 and include lapsed and withdrawn deals. The tables cover all sectors andare based on the geography of either the target, bidder or seller being Latin American-based.
YTD 31-Jul-10
house Value (US$m)
Deal count
1 Mattos Filho, Veiga Filho, Marrey Jr. e quiroga Advogados
1,716 13
2 Machado Meyer Sendacz e opice 4,187 11
3 Tozzini Freire Teixeira E Silva Advogados 5,786 10
4 pinheiro Neto Advogados 3,591 10
5 Estudio Muniz, Ramirez, perez-Taiman & olaya Abogados
466 9
6 Barbosa, Mussnich & Aragao 5,395 8
7 Skadden Arps Slate Meagher & Flom 18,938 7
8 Cleary gottlieb Steen & hamilton 14,567 6
9 Uria Menendez 11,548 6
10 Simpson Thacher & Bartlett 9,495 6
11 Demarest e Almeida 1,257 6
12 Davis polk & Wardwell 8,300 5
13 Linklaters 1,284 5
14 Latham & Watkins 6,800 4
15 pinheiro guimaraes Advogados 3,873 4Source: mergermarket
TOP 15 LEgAL ADVISORS – LATIN AMERICA
10
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ERICA
Monthly M&A Insider
TREND gRAphS
LATIN AMERICAN M&A qUARTERLY TREND
VALUE VoLUME
0
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125
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175
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Num
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LATIN AMERICAN M&A qUARTERLY MID-MARkET TREND
VALUE VoLUME
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6,000
Q310*
Q210
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Q109
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Q108
Q407
Q307
Q207
Q107
Q406
Q306
Q206
Q106
Q405
Q305
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Q105
Q404
Q304
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Q104
Valu
e (U
S$m
)
0
20
40
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Q310*
Q210
Q110
Q409
Q309
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q207
Q107
Q406
Q306
Q206
Q106
Q405
Q305
Q205
Q105
Q404
Q304
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Num
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11
LATIN AM
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Monthly M&A Insider
TREND gRAphS
LATIN AMERICAN M&A SECTOR BREAkDOwN YTD 2010
VALUE VoLUME
10.0%
10.2%
17.1%
0.7%0.8% 1.9%
0.1%2.4%
0.7%
46.9%
8.2%
1.1%
Energy, Mining & Utilities
Consumer
Industrials & Chemicals
Financial Services
Business Services
TMT
Leisure
Agriculture
Pharma, Medical & Biotech
Transport
Real Estate
Construction
15.7%
19.9%
0.9%0.9%
2.8%5.1%
5.1%
10.2%
11.6%14.4%
5.6%
7.9%
Energy, Mining & Utilities
Consumer
Industrials & Chemicals
Financial Services
Business Services
TMT
Leisure
Agriculture
Pharma, Medical & Biotech
Transport
Real Estate
Construction
LATIN AMERICAN M&A qUARTERLY PRIVATE EqUITY TREND
VALUE VoLUME
0
3
6
9
12
15
Q3 10*
Q210
Q110
Q409
Q309
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q207
Q107
Q406
Q306
Q206
Q106
Q405
Q305
Q205
Q105
Q404
Q304
Q204
Q104
Num
ber
of d
eals
Latin American buyouts
Latin American exits
0
500
1,000
1,500
2,000
2,500
Q310*
Q210
Q110
Q409
Q309
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q207
Q107
Q406
Q306
Q206
Q106
Q405
Q305
Q205
Q105
Q404
Q304
Q204
Q104
Valu
e (U
S$m
)
Latin American buyouts
Latin American exits
NORTH
AMERICA
NORTH AMERICAA MERgERMARkET M&A REpORT ON
12Monthly M&A Insider
It should be noted that the volume of buyout deals did not expand at the same rate as the value of the deals themselves. The first half of 2010 had 281 buyout transactions during the first half of 2010; a 19.0% increase over the 228 deals witnessed during the same period last year.
The average North American buyout deal size is at the highest level it has been in three years. Q3 2007 had an approximate average buyout deal value size of US$288 and although the average is distant from 2007’s second quarter high of US$707m, the increase compared to last year is a sure sign that access to capital is returning because investors are willing to take on higher valued targets.
Avis antitrust case more challenging than HertzAvis Budget may face a more challenging antitrust review to acquire Dollar Thrifty than rival bidder Hertz based on the firms’ proposed divestitures, sources said.
During the last week of July, Avis announced a formal rival bid for Dollar Thrifty that is 7.0% higher than Hertz’s existing US$2.20 bid for the car rental company. In a merger document filed with the SEC, Avis proposed airport location divestitures representing US$325m in global revenue, including US$250m worth of divestitures earmarked for the US.
The Federal Trade Commission is running a concurrent antitrust review of Avis and Hertz’s bids. A source familiar with the reviews said he does not expect the FTC to be in a position to advise either company on the status of their respective approaches before September at the earliest.
A second source following the duelling bids said that the government may place a 40.0% ceiling on market share at airport locations on the company that acquires Dollar Thrifty. This requirement would require more drastic divestitures than already outlined, the source said.
The first source said Avis’s proposed US$325m in revenue divestitures may be part of a larger divestiture plan the company has yet to make public, given the scrutiny both parties are expecting from the review and the concentration Avis already has in the leisure car rental market.
Hertz has proposed the divestiture of its Advantage brand, which contributed US$140m in revenue to the company in the most recent financial year, in addition to business lines that generate US$175m of revenue. The second source said Hertz’s decision to divest the brand may give it a leg up over Avis, which has just publicly proposed to divest airport locations.
A separate person briefed on matter pointed out that Avis has not put any restrictions on the location and profitability of the airport locations it is willing to divest, while Hertz has been prescriptive in its divestiture plan by earmarking the Advantage brand.
Still, the two sources and an industry banker said the concentration of the car rental industry generally is likely to make it uncertain whether the FTC will allow either Hertz or Avis’s bids to go through.
The second source said the FTC will consider the higher pricing environment in the rental market since Enterprise Rent-A-Car’s acquisition of National and Alamo in 2007 as rationale to consider blocking either deal or requesting further remedies than the ones already proposed.
Both rival rental car companies have a presence in the leisure market where Dollar Thrifty’s business is focused; however, Avis is the only bidder with an established leisure brand in the form of Budget.
Overall, Avis derived approximately 60.0% of its revenue from leisure customers in 2009, while Hertz derived 57.0% of its revenues from the leisure segment in the same period, according to the respective companies’ most recent 10-k filings.
NortH AMerIcAN Buyouts INcreAse IN DeAl VAlue
WITH AppROxIMATEly 44 BUyOUT TRANSACTIONS vAlUED OvER US$9.20BN, NORTH AMERICA HAD AN AvERAgE BUyOUT DEAl vAlUE OF US$210M FOR THE MONTH OF JUly. THIS IS A SlIgHT INCREASE OvER THE SECOND QUARTER FIgURE OF US$203M, AND A SIgNIFICANT BOOST FROM Q1 2010 WHICH HAD AN AvERAgE vAlUE OF ONly US$69M. FOR THE SAME pERIOD IN 2008, NORTH AMERICAN BUyOUT’S HAD AN AvERAgE DEAl vAlUE OF US$78M.
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Monthly M&A Insider
target: Hewitt Associates Inc Announced: 12-Jul-10
Bidder: Aon Corporation Deal value: US$4.49bn
seller: Deal nature: Acquisition, Domestic, public
structure• Hewitt Associates, Inc. (HEW), a Delaware corporation,
have signed a definitive agreement to be acquired by Aon Corporation (AON), a Delaware corporation. The boards of directors of both companies have approved the merger.
• Hewitt Associates, a US-based company headquartered in lincolnshire, Il, provides human resources benefits, outsourcing, and consulting services primarily in the US and the United kingdom.
• Aon, a US-based company headquartered in Chicago, Il, is the leading global provider of risk management services, insurance and reinsurance brokerage, and human capital consulting.
terMs• US$25.61 and 0.6362 AON shares will be exchanged for
each HEW share.
• This represents a value of US$50.00 for each HEW share based on AON’s closing share price on 9-Jul-10 of US$38.34.
• The offer provides a premium of 41.2% based on HEW’s closing share price on 9-Jul-10 of US$35.40.
• The implied equity value of the transaction is approximately US$4.60bn.
• If a superior offer were to emerge for HEW, the company would be required to give AON at least 5 business days to make adjustments to its current offer before HEW’s board of directors could effect a change of recommendation of the deal.
FINANcING• Financing commitments from Credit Suisse and Morgan
Stanley for 100% of the cash consideration are in place for a three-year US$1.00bn bank term loan and a US$1.50bn bridge loan facility.
• Aon expects to issue unsecured notes prior to drawing on the bridge loan facility.
rAtIoNAle• Aon believes the combination of Aon and Hewitt creates
a global leader in human capital solutions, benefitting clients, associates and stockholders. The combined client base and product portfolio will provide significant cross-sell opportunities. The transaction is expected to generate approximately US$355m in annual cost savings across Aon Hewitt in 2013, primarily from reduction in back-office areas, public company costs, management overlap and leverage of technology platforms.
coNDItIoNs • HSR (US)
• EC (Europe)
• CA (Canada)
• ICA (Canada)
• HEW EgM (majority affirmative vote required to approve)
• AON EgM (majority affirmative vote required to approve)
eXPecteD coMPletIoN • The transaction is expected to close in mid-November
of 2010.
terMINAtIoN DAte • The termination date for the transaction is 31 March 2011.
terMINAtIoN Fee • Hewitt must pay Aon a termination fee of US$85m or
US$190m, as applicable. This represents 1.8% or 4.1% of the implied equity value of the deal. The per-share increase required to cover the fee in a superior offer would be US$0.92 or US$2.05.
• If the Merger Agreement is terminated under certain other specified circumstances, Aon must pay Hewitt a termination fee of US$190m or, if the Merger Agreement is terminated under certain specified circumstances relating to Aon’s failure to obtain the requisite financing for the Merger, a termination fee of US$225m.
DEAl OF THE MONTH
14Monthly M&A Insider
NORTH
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DEAl OF THE MONTH
Advisors
target/seller Bidder
Financial Citigroup Financial Credit Suisse
legal Shearman & Sterling (Advising Ctigroup); Debevoise & plimpton; paul Weiss Rifkind Wharton & garrison
legal Davis polk & Wardwell (Advising Credit Suisse);Sidley Austin
exit multiples – y/e 30-sep-09 Premium analysis
Multiples Value (us$m) offer price per share (us$) 50.00
revenue 1.5 x 3,073 1 day before 41.24%
eBItDA 7.5 x 599 1 month before 41.44%
eBIt 10.3 x 434 1 day after 4.69%
earnings 18.0 x 262 Pre-rumour -
mergermarket/dealreporter Intelligence
28-Jul-10 Hewitt: Aon launches loan syndication, source says
13-Jul-10 Hewitt/Aon finance timing linked to shareholder vote, source says
timetable and expected events
regulatory Date Notes
HSR (US) 23-Aug-10 30 calendar days waiting period; further 30 calendar days following compliance with the request for additional information; filed on 23-Jul-10
CA (Canada) Refers to Competition Act of Canada, 14 calendar days for short form application, 42 calendar days for long form application
ICA (Canada) Refers to Investment Canada Act, 45 calendar days initial investigation; can be extended by further 30 calendar days
EC Notification (Europe) Refers to approval by the European Commission; 25/35 trading days for phase-1 decision, further 90 trading days if referred to phase-2
Last date for Art. 9/Art. 22 request
15 trading days from EC notification
Last day for remedies within phase 1
20 trading days from EC notification, will cause 10 trading day extension if remedies submitted
Art. 9/Art. 22 decision 10 trading days from request
EC Decision 25 trading days from notification standard
offer timetable
Plan of merger 12-Jul-10 Refers to plan of merger filed with SEC Form 8-k
Debt commitment letter 12-Jul-10 Refers to debt commitment letter filed with SEC Form 8-k
Prelim proxy 26-Jul-10 Refers to preliminary proxy statement filed with SEC, reviewing process typically lasts at least 30 calendar days, and can be as long as 60 calendar days S-4
Termination date 31-May-11 Refers to date by which merger must be completed before agreement must be amended
Def proxy Refers to definitive proxy statement declared effective by SEC
Effective date Refers to date merger becomes effective, normally 2 trading days after EgM approval
Settlement date Refers to date payment can be expected by, normally within 4 business days of Effective Date in state of Delaware
company events
HEW 3Q-10 5-Aug-10 Refers to third quarter 2010 earnings
AON EGM record date 16-Aug-10 Refers to date shares must be held by in order to vote at the EgM
HEW EGM record date 16-Aug-10 Refers to date shares must be held by in order to vote at the EgM
HEW EGM 20-Sep-10 Refers to approval of merger by target's shareholders; majority affirmative vote required to approve; normally 1 month from def proxy
AON EGM 20-Sep-10 Refers to approval of merger by bidder's shareholders; majority affirmative vote required to approve; normally 1 month from def proxy
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Monthly M&A Insider
toP 15 NortH AMerIcAN ANNouNceD DeAls For ytD 31 July 2010 Announced status target company sector Bidder company seller company exit multiples (x) Bid premia
1-day beforeDeal value
(us$m)revenue eBItDA P/e
22-Apr-10 p Qwest Communications International Inc
TMT Centurylink 1.8 5.2 15.9 15.0% 22,153
8-Mar-10 p American life Insurance Company
Financial Services
Metlife American International group
n/a n/a - 15,544
25-Feb-10 p Coca-Cola Enterprises Inc (North American operations)
Consumer The Coca-Cola Company
Coca-Cola Enterprises
- 12,280
21-Feb-10 p Smith International Inc Energy, Mining & Utilities
Schlumberger limited
1.5 12.7 67.4 18.1% 12,198
19-Jan-10 C The Williams Companies Inc (certain gas pipeline and domestic midstream businesses)
Energy, Mining & Utilities
Williams partners The Williams Companies
- 11,750
11-Feb-10 p Allegheny Energy Inc Energy, Mining & Utilities
FirstEnergy Corp 2.6 7.5 12.0 31.6% 8,960
9-Mar-10 p Merial limited; and Intervet/Schering-plough Animal Health
pharma, Medical & Biotech
Merial-Intervet Merck & Co; and Sanofi-Aventis SA
- 8,250
28-Apr-10 p E.ON US llC Energy, Mining & Utilities
ppl Corporation E.ON Ag - 7,625
11-Mar-10 p Devon Energy Corporation (Assets in the deepwater gulf of Mexico, Brazil and Azerbaijan)
Energy, Mining & Utilities
Bp plc Devon Energy Corporation
- 7,000
11-Feb-10 p Airgas Inc Industrials & Chemicals
Air products & Chemicals
1.8 10.8 27.1 3.6% 6,834
28-Feb-10 C Millipore Corporation pharma, Medical & Biotech
Merck kgaA 4.1 16.3 34.0 13.3% 6,760
31-Mar-10 p general growth properties Inc (65.00% Stake)
Real Estate Brookfield Asset Management; Fairholme Capital Management llC; and pershing Square Capital Management
n/a n/a [loss] -7.5% 6,550
14-Jun-10 C QEp Resources Inc Energy, Mining & Utilities
Questar Corporation (Shareholders)
Questar Corporation
3.8 6.6 29.9 - 6,438
3-May-10 p Continental Airlines Inc Transportation UAl Corporation 0.5 17.8 [loss] 1.5% 6,192
12-May-10 C Sybase Inc Business Services
SAp Ag 4.4 13.1 34.9 56.4% 5,102
C = Completed; p = pending; l = lapsed Source: mergermarket
TOp DEAlS & ExpECTED DEAlS
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Monthly M&A Insider
TOp DEAlS & ExpECTED DEAlS
toP 5 NortH AMerIcAN ANNouNceD DeAls oF tHe MoNtH (July 2010) Announced status target company sector Bidder company seller company exit multiples (x) Bid premia
1-day before
Deal value
(us$m)revenue eBItDA P/e
12-Jul-10 p Hewitt Associates Business Services Aon Corporation 1.5 7.5 18.0 41.2% 4,487
15-Jul-10 p NBTy Consumer The Carlyle group llC
1.4 10.9 23.9 46.8% 3,627
22-Jul-10 p AmeriCredit Corporation Financial Services general Motors Company
n/a n/a 222.7 24.4% 3,306
20-Jul-10 p Bp plc (Western Canadian upstream gas assets)
Energy, Mining & Utilities
Apache Corporation Bp plc - 3,250
20-Jul-10 C Bp plc (permian Basin assets in Texas and south-east New Mexico)
Energy, Mining & Utilities
Apache Corporation Bp plc - 3,100
9-Jul-10 p Multiplan Inc pharma, Medical & Biotech
BC partners limited; and Silver lake partners
The Carlyle group llC; and Welsh, Carson, Anderson & Stowe
- 3,100
C = Completed; p = pending; l = lapsed Source: mergermarket
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Monthly M&A Insider
situation target company sector Potential bidder company
Financial advisor to bidder (B); target (t); seller (s)
seller company
Market cap/ est. value (us$m)
comments
Expected Deal Novell TMT Elliott Associates
(T) JpMorgan 2,084 Elliott Associates, l.p. (together with funds under common management), a significant institutional stockholder of Novell, offered to purchase the entire company for US$5.75 per share in cash, which implies an enterprise value net of cash of US$1.00bn. The firm sent a letter to the Board of Directors of the Company explaining its offer.
Expected Deal Dollar Thrifty Automotive group
Industrials & Chemicals
Avis Budget group,
(B) Citigroup 1,281 Avis Budget group would like to make a substantially higher offer to acquire Dollar Thrifty. Dollar Thrifty had recently signed a definitive agreement to be acquired by Hertz for approximately US$41.00 per share.
Expected Deal playboy Enterprise Media The Hefner Family
187 playboy Enterprises, Inc. (pEI) announced that its board of directors has formed a special committee consisting of Sol Rosenthal and Shing Tao to evaluate and determine the company’s response to the proposal made by Hugh M. Hefner (‘Hefner’) on 9 July 2010 to acquire all of the outstanding shares of Class A and Class B common stock of pEI not currently owned by Hefner for US$5.50 per share in cash.
Expected Deal California pizza kitchen
leisure Undisclosed Bidder
(B) Moelis & Company
439 California pizza kitchen (CpkI) announced that its Board of Directors has authorised management to consider a wide range of financial and strategic alternatives to enhance shareholder value. The Company has engaged Moelis & Company, a global investment bank, to be its exclusive financial advisor in this review. California pizza kitchen, a US-based company headquartered in los Angeles, California, is a casual dining restaurant chain with a particular focus on the pizza segment.
Expected Deal Mediacom Communications Corporation
TMT Media's founder, Chairman and CEO, Rocco B. Commisso
(B) Bank of American Merrill lynch, (B) J.p. Morgan Securities, (T) Barclays Capital
475 Mediacom Communications Corporation’s Board of Directors received a non-binding proposal from Mediacom’s founder, Chairman and Chief Executive Officer, Rocco B. Commisso, for a go-private transaction. The proposal contemplates the acquisition of all of the Class A and Class B shares of Mediacom common stock not already beneficially owned by Mr. Commisso at a price of US$6.00 per share in cash.
Expected Deal galleon Energy Energy, Mining & Utilities
Undisclosed Bidder
(T) Cormark Securities, gMp Securities, Macquarie Capital Markets Canada
410 galleon Energy’s financial advisors are already talking with potential buyers. galleon announced it had retained gMp Securities, Cormark and Macquarie Capital to review strategic alternatives, which will alude a number of options; including an outright sale or disposal of a material portion of its assets.
Expected deals are based on confirmed announcements by companies involved.
PIPelINe oF NortH AMerIcAN eXPecteD DeAls
TOp DEAlS & ExpECTED DEAlS
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Monthly M&A Insider
lEAgUE TABlES
vAlUEytD
31-Jul-10House Value
(us$m)Deal count
1 goldman Sachs 167,333 111
2 Morgan Stanley 117,620 82
3 Barclays Capital 116,516 58
4 Credit Suisse 112,423 77
5 Deutsche Bank 104,854 54
6 JpMorgan 104,224 63
7 Bank of America Merrill lynch 103,358 74
8 Citigroup 80,015 49
9 lazard 72,582 53
10 UBS Investment Bank 61,991 57
11 Evercore partners 37,770 12
12 perella Weinberg partners 35,507 10
13 Blackstone group Holdings 30,894 13
14 Tudor, pickering, Holt & Co 22,832 12
15 RBC Capital Markets 22,665 43
16 greenhill & Co 20,780 17
17 HSBC Bank 18,245 11
18 Jefferies & Company 16,064 40
19 Allen & Company 15,462 6
20 Rothschild 13,537 41Source: mergermarket
vOlUME
The financial advisor league tables by value and volume have been run from 1 January 2010 to 31 July 2010 and exclude lapsed and withdrawn deals. The tables cover all sectors andare based on the geography of either the target, bidder or seller being US or Canadian-based.
ytD 31-Jul-10
House Value (us$m)
Deal count
1 goldman Sachs 167,333 111
2 Morgan Stanley 117,620 82
3 Barclays Capital 112,423 77
4 Credit Suisse 103,358 74
5 Deutsche Bank 104,224 63
6 JpMorgan 116,516 58
7 Bank of America Merrill lynch 61,991 57
8 Citigroup 104,854 54
9 lazard 72,582 53
10 UBS Investment Bank 80,015 49
11 Evercore partners 22,665 43
12 perella Weinberg partners 13,537 41
13 Blackstone group Holdings 16,064 40
14 Tudor, pickering, Holt & Co 8,389 34
15 RBC Capital Markets 9,094 31
16 greenhill & Co 4,587 27
17 HSBC Bank 7,461 26
18 Jefferies & Company 746 24
19 Allen & Company 6,782 23
20 Rothschild 821 23Source: mergermarket
toP 20 FINANcIAl ADVIsors – NortH AMerIcA
vAlUEytD
31-Jul-10House Value
(us$m)Deal count
1 Simpson Thacher & Bartlett 148,373 73
2 Sullivan & Cromwell 102,244 54
3 latham & Watkins 101,453 85
4 Skadden Arps Slate Meagher & Flom 101,035 71
5 Cleary gottlieb Steen & Hamilton 91,349 37
6 Weil gotshal & Manges 86,882 59
7 Wachtell, lipton, Rosen & katz 85,852 35
8 Davis polk & Wardwell 84,129 44
9 Cravath Swaine & Moore 78,036 29
10 Debevoise & plimpton 72,256 22
11 Dewey & leBoeuf 72,252 52
12 Shearman & Sterling 60,390 43
13 Blake, Cassels & graydon 54,556 55
14 Slaughter and May 50,540 15
15 Baker Botts 46,757 24
16 Herbert Smith/gleiss lutz/Stibbe 44,570 17
17 Fried Frank Harris Shriver & Jacobson 39,901 27
18 paul Weiss Rifkind Wharton & garrison 37,500 33
19 gibson Dunn & Crutcher 37,314 48
20 Norton Rose 35,500 5Source: mergermarket
vOlUME
The legal advisor league tables by value and volume have been run from 1 January 2010 to 31 July 2010 and lude lapsed and withdrawn deals. The tables cover all sectors andare based on the geography of either the target, bidder or seller being US or Canadian-based.
ytD 31-Jul-10
House Value (us$m)
Deal count
1 Jones Day 32,323 90
2 latham & Watkins 101,453 85
3 kirkland & Ellis 17,823 85
4 DlA piper 5,935 84
5 Simpson Thacher & Bartlett 148,373 73
6 Skadden Arps Slate Meagher & Flom 101,035 71
7 Weil gotshal & Manges 86,882 59
8 Blake, Cassels & graydon 54,556 55
9 Sullivan & Cromwell 102,244 54
10 Dewey & leBoeuf 72,252 52
11 gibson Dunn & Crutcher 37,314 48
12 Davis polk & Wardwell 84,129 44
13 Shearman & Sterling 60,390 43
14 k&l gates 12,474 40
15 Stikeman Elliott 15,578 39
16 Morgan lewis & Bockius 9,001 39
17 Osler, Hoskin & Harcourt 27,290 38
18 Cleary gottlieb Steen & Hamilton 91,349 37
19 Hogan lovells 7,195 37
20 Wilson Sonsini goodrich & Rosati 3,629 36Source: mergermarket
toP 20 leGAl ADVIsors – NortH AMerIcA
19
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Monthly M&A Insider
lEAgUE TABlES
vAlUE vOlUME
The private equity buyout activity tables by value and volume are based on private equity firms advising the bidder on buyout deals where the dominant geography of the target company is US or Canadian-based. The tables by value and volume have been run from 1 January 2010 to 31 July 2010 and exclude lapsed and withdrawn deals.
toP 5 PrIVAte equIty FIrMs By NortH AMerIcAN Buyouts
vAlUE
ytD 31-Jul-10
House Value (us$m)
Deal count
1 kohlberg kravis Roberts & Co 4,700 1
2 Cerberus Capital Management 4,048 3
3= Arclight Capital partners 2,774 1
3= kelso & Company 2,774 1
5 Thomas H lee partners 2,560 2Source: mergermarket
vOlUME
The private equity exit activity tables by value and volume are based on private equity firms advising the vendor on exit deals where the dominant geography of the target company is US or Canadian-based. The tables by value and volume have been run from 1 January 2010 to 31 July 2010 and exclude lapsed and withdrawn deals.
ytD 31-Jul-10
House Value (us$m)
Deal count
1 kohlberg kravis Roberts & Co 4,700 1
2 Thomas H lee partners 4,500 2
3 Cerberus Capital Management 4,046 3
4= Hellman & Friedman 3,525 2
4= JMI Equity 3,525 2Source: mergermarket
toP 5 PrIVAte equIty FIrMs By NortH AMerIcAN eXIts
ytD 31-Jul-10
House Value (us$m)
Deal count
1 Silver lake partners 6,259 4
2 Blackstone group Holdings 5,295 3
3 Thomas H lee partners 4,692 5
4 Centerbridge partners 3,925 3
5 The Carlyle group 3,772 3Source: mergermarket
ytD 31-Jul-10
House Value (us$m)
Deal count
1 Tpg Capital 2,949 6
2 HIg Capital 149 6
3 Thomas H lee partners 4,692 5
4 gS Capital partners 2,769 5
5 Sun Capital partners 179 5Source: mergermarket
20
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Monthly M&A Insider
TREND gRApHS
NortH AMerIcAN M&A quArterly treND
0
100,000
200,000
300,000
400,000
500,000
600,000
Q310*
Q210
Q110
Q409
Q309
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q207
Q107
Q406
Q306
Q206
Q106
Q405
Q305
Q205
Q105
Q404
Q304
Q204
Q104
Valu
e (U
S$m
)
0
200
400
600
800
1,000
1,200
1,400
Q310*
Q210
Q110
Q409
Q309
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q207
Q107
Q406
Q306
Q206
Q106
Q405
Q305
Q205
Q105
Q404
Q304
Q204
Q104
Volu
me
of d
eals
NortH AMerIcAN M&A quArterly MID-MArket treND
vAlUE vOlUME
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
Q310*
Q210
Q110
Q409
Q309
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q207
Q107
Q406
Q306
Q206
Q106
Q405
Q305
Q205
Q105
Q404
Q304
Q204
Q104
Valu
e (U
S$m
)
0
100
200
300
400
500
600
Q310*
Q210
Q110
Q409
Q309
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q207
Q107
Q406
Q306
Q206
Q106
Q405
Q305
Q205
Q105
Q404
Q304
Q204
Q104
Num
ber
of d
eals
Moving average trend line
vAlUE vOlUME
21
NORTH
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Monthly M&A Insider
TREND gRApHS
NortH AMerIcAN M&A sector BreAkDowN ytD 2010
vAlUE vOlUME
31.9%
5.7%
8.1%
10.0%
9.5%15.0%
1.0%2.0%0.2%
0.7%
12.3%
2.0%
1.7%
Industrials & Chemicals
Financial services
Business services
Consumer
Energy, Mining & Utilites
TMT
Leisure
Transportation
Pharma, Medical & Biotech
Construction
Agriculture
Real Estate
Defence
14.3%
12.1%
8.4%
14.2%
12.1%
19.2%
3.3%
9.3%
3.2%
0.5%1.0%
0.9%
1.6%
Industrials & Chemicals
Financial services
Business services
Consumer
Energy, Mining & Utilites
TMT
Leisure
Transportation
Pharma, Medical & Biotech
Construction
Agriculture
Real Estate
Defence
NortH AMerIcAN M&A quArterly PrIVAte equIty treND
0
25,000
50,000
75,000
100,000
125,000
150,000
175,000
200,000
225,000
Q310*
Q210
Q110
Q409
Q309
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q207
Q107
Q406
Q306
Q206
Q106
Q405
Q305
Q205
Q105
Q404
Q304
Q204
Q104
Valu
e (U
S$m
)
North American buyouts
North American exits
0
25
50
75
100
125
150
175
200
225
250
275
Q310*
Q210
Q110
Q409
Q309
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q207
Q107
Q406
Q306
Q206
Q106
Q405
Q305
Q205
Q105
Q404
Q304
Q204
Q104
Num
ber
of d
eals
North American buyouts
North American exits
vAlUE vOlUME
22
NORTH
AMERICA
Monthly M&A Insider
TREND gRApHS
NortH AMerIcAN M&A DeAl sIze BreAkDowN
vAlUE vOlUME
0
100
200
300
400
500
600
700
800
900
1,000
H2 2010*
H12010
H22009
H12009
H22008
H12008
H22007
H12007
H22006
H12006
H22005
H12005
H22004
H12004
> US$501m
US$251m-US$500m
US$101m-US$250m
US$15m-US$100m
US$5m-US$14.9m
Valu
e (U
S$bn
)
0
500
1,000
1,500
2,000
2,500
3,000
H22010*
H12010
H22009
H12009
H22008
H12008
H22007
H12007
H22006
H12006
H22005
H12005
H22004
H12004
Num
ber
of d
eals
> US$501m
US$251m-US$500m
US$101m-US$250m
US$15m-US$100m
US$5m-US$14.9m
Value not disclosed
ASIA-PAcIfIc
A mergermArket m&A report on
Monthly M&A Insider 23
ASIA-pAcIfIc
FortIs quIts the bIddIng wAr leAvIng KhAzAnAh to tAKe over PArKwA
on 26 July 2010, fortis Healthcare Limited, the listed Indian hospital operator, withdrew its SgD3.2bn (US$2.3bn) offer to acquire the remaining shares of parkway, leaving Integrated Healthcare Holdings, a subsidiary of the malaysian sovereign fund khazanah nasional Berhad, to acquire all the outstanding shares.
parkway is one of largest hospital operations throughout Asia with 16 hospitals, offering more than 3,400 beds in places such as Singapore, china, malaysia, Brunei and India. Its healthcare spending is increasing in Asian markets by up to 17.0% a year, making parkway an attractive acquisition target for both fortis and khazanah to spearhead their regional expansion in the growing healthcare market.
khazanah, through Integrated Healthcare, had originally offered SgD1.18bn (US$835m) to increase its stake in parkway from 23.90% to 51.50% in may 2010. fortis then announced a counter offer of SgD3.8 (US$2.70) per share for all the remaining parkway shares. parkway would be the jewel asset of khazanah’s healthcare business, but there was obvious concern raised by the fortis offer. pantai Hospitals, a malaysian joint venture currently 60.00% owned by khazanah and 40.00% by parkway, is a significant earnings contributor, making up approximately 25.0% of revenue and 30.0% of earnings before interest, tax, depreciation, amortisation and rent (eBItDAr) at parkway.
However fortis decided to withdraw after is was discovered that the shareholders agreement of the joint venture between parkway and khazanah contained possible deadlock provisions that could be triggered by the purchase. the agreement is understood to have contained russian roulette clauses, whereby a change of control at parkway would allow khazanah to exercise an option to either takeover the stake it currently does not own in pantai, or sell its 60.00% stake to parkway or a third party. this meant that even if fortis succeeded in the acquisition, it could have ended up losing a significant portion of parkway.
In the end, khazanah offered SgD3.95 (US$2.90) per share on 26 July, valuing all the shares it does not own at a total of SgD3.5bn (US$2.57bn), which led to fortis deciding to sell its 283m parkway shares.
PAnAsonIc FInAlly ProceedIng to AcquIre sAnyoon 29 July, panasonic corporation announced its plan to turn Sanyo electric into a wholly owned subsidiary for over JpY400bn. Despite the deal size, however, the announcement was seen as part of the course already set by the firm and was thus of no great surprise.
When panasonic approached to acquire the company in 2008, Sanyo had two classes of preference shares that, when converted, would make up for more than 50.0% of common shares. these preference shares were largely controlled by Daiwa Securities SmBc principal Investments and goldman Sachs, and although Sanyo electric was a listed entity, any potential bidder needed to secure the agreement of these two investors of preferential shares. the parties agreed to value the preference share at JpY1,310 per share, which meant JpY131 per common share when converted. the agreement in 2008 was completed a year later on 21 December 2010 when panasonic converted them to 50.10% stake in Sanyo electric.
With the tender offer on 29 July 2010, panasonic intend to acquire the remaining common shares at JpY138, representing a 21.9% premium over the closing price the previous day, or a 5.3% premium over the price offered in 2008 to holders of preference share. the offer will be open until the 6 october 2010.
ASIA-PAcIfIc
Monthly M&A Insider 24
xxtarget: Sanyo electric co Ltd Announced: 29-Jul-10
bidder: panasonic corporation deal value: US$4.84bn
seller: deal nature: recommended
• panasonic corporation, the Japan-listed electronic and electric products manufacturer, has made an offer to acquire a 49.95% stake not already owned Sanyo electric co Ltd, the Japan-listed consolidated electronic and energy products manufacturer, for a consideration of JpY428.48bn (US$4.84bn).
• the transaction will be conducted via a cash offer.
• JpY138 in cash per Sanyo electric share.
• the offer term represents a discount of 7.4% upon the closing price of JpY149 on 29-Jul-10, the last trading day prior to trading halt before the announcement.
• the offer term also represents a premium of 5.1% over the offer term of the last successful tender offer of JpY131 on 19-Dec-10.
• A maximum cash consideration of JpY424.52bn (US$4.86bn) will be financed.
• panasonic corp currently owns 50.05% of Sanyo electric co Ltd.
condItIons:• Unconditional as to acceptances.
DeAL of tHe montH
Advisers
target/seller bidder
Financial ABeam m&A consulting corp fin Financial nomura Holdings
legal mori Hamada & matsumoto legal
Pr Pr
exit multiples – y/e 31-dec-09 Premium analysis
Multiples value (JPym) offer price per share (JPy) 138
revenue 0.7x 1,594,640 1 day before 149
ebItdA 10.3x 107,668 1 month before 116
ebIt 34.4x 32,282 1 day after 136
earnings -48,789 Pre-rumour n/a
25
ASIA-PAcIfIc
Monthly M&A Insider
DeAL of tHe montH
mergermarket/dealreporter Intelligence
29-Jul-10 Sanyo electric: panasonic requires no antitrust approvals
29-Jul-10 panasonic to prioritise cash and treasury stock to fund subsidiary buyouts
timetable and expected events
offer timetable date completed
Target's official response 29-Jul-10 Y reference Board of directors agrees with the tender offer to be made by panasonic corp
Offer period commences 23-Aug-10 from company; offer commencement notice issued on the same day, Article 27-9
Last day for revising/extending/competing offer
6-oct-10 Latest at closing date, Article 27-6(3)
closing date 6-oct-10 30 trading days, Article 27-10(3)
Offer results 7-oct-10 normally next calendar day from closing date of offer
Settlement 13-oct-10 reference transfer of JpY138 per share to shareholders of Sanyo electric who participated in tender offer
company events
6752 Q1 results 8-Jun-10 Y dealreporter estimate: expected mid Aug-10, reference 1st quarter financial results of panasonic corp, ended 30-Jun-10
26Monthly M&A Insider
ASIA-PAcIfIc
toP 15 AsIA-PAcIFIc Announced deAls For ytd 31 July 2010Announced status target company sector bidder company seller company exit multiples (x) bid premia
1-day beforedeal value
(us$m)revenue ebItdA P/e
1-mar-10 L American International Assurance company Limited
financial Services
prudential plc American International group Inc
n/a n/a 20.2 - 35,500
30-mar-10 p AXA Asia pacific Holdings (Asian businesses)
financial Services
AXA SA AXA Asia pacific Holdings Limited
n/a n/a 24.7 - 8,645
4-may-10 p Lihir gold Limited energy, mining & Utilitie
newcrest mining Limited
8.5 19.9 54.2 9.5% 8,286
10-mar-10 p Shanghai pudong Development Bank (20.00% Stake)
financial Services
china mobile group guangdong co Ltd
n/a n/a 11.1 -13.1% 5,831
29-Jul-10 p Sanyo electric co Ltd (49.95% Stake)
Industrials & chemicals
panasonic corporation
0.7 11.0 (loss) -7.4% 4,839
29-Jul-10 p panasonic electric Works Ltd (49.00% Stake)
Industrials & chemicals
panasonic corporation
-1.2% 4,657
25-Jan-10 c Jupiter telecommunications co Ltd (37.80% Stake)
tmt kDDI corporation Liberty global Inc
3.6 8.3 32.6 64.5% 4,014
21-may-10 p piramal Healthcare Solutions business
pharma, medical & Biotech
Abbott Laboratories piramal Healthcare Limited
8.3 - 3,720
30-mar-10 p AXA Asia pacific Holdings Limited
financial Services
national Australia Bank Limited
n/a n/a 21.8 1.3% 3,579
22-mar-10 c Arrow energy Limited energy, mining & Utilities
royal Dutch Shell; and petrochina
36.9 7.4 10.5 -11.2% 3,352
18-may-10 p Denway motors Limited (62.10% Stake)
Automotive guangzhou Automobile group co Ltd
62.1 (loss) 23.6 53.0% 3,293
31-mar-10 c emobile Limited (57.45% Stake)
tmt eAccess Limited temasek Holdings pte Ltd; and gS capital partners
3.3 (loss) - 3,051
6-may-10 p Hua Xia Bank co Limited (27.15% Stake)
financial Services
Deutsche Bank Luxembourg SA; Shougang group corporation; and State grid Asset management company Limited
n/a n/a 14.9 - 3,042
27-may-10 p parkway Holdings Ltd (77.66% Stake)
pharma, medical & Biotech
khazanah nasional Berhad
4.3 22.5 35.9 26.1% 2,861
17-mar-10 c Astro All Asia networks plc
tmt Astro Holdings Sdn Bhd
3.0 (loss) (loss) 20.3% 2,649
c = completed; p = pending; L = Lapsed Source: mergermarket
top DeALS & eXpecteD DeALS
27Monthly M&A Insider
ASIA-PAcIfIc
toP 5 AsIA-PAcIFIc Announced deAls oF the Month (July 2010)Announced status target company sector bidder company seller company exit multiples (x) bid premia
1-day beforedeal value
(us$m)revenue ebItdA P/e
29-Jul-10 p Sanyo electric co Ltd (49.95% Stake)
Industrials & chemicals
panasonic corporation 0.7 11.0 (loss) -7.4% 4,839
29-Jul-10 p panasonic electric Works Ltd (49.00% Stake)
Industrials & chemicals
panasonic corporation 0.6 9.9 103.2 -1.2% 4,657
1-Jul-10 L parkway Holdings Ltd (74.73% Stake)
pharma, medical & Biotech
fortis Healthcare Limited 4.9 25.7 36.3 6.5% 2,626
30-Jul-10 p tanjong plc (52.82% Stake)
energy, mining & Utilities
Usaha tegas Sdn Bhd 3.3 8.5 13.9 22.1% 2,474
19-Jul-10 p Healthscope Limited pharma, medical & Biotech
carlyle group; and tpg capital
1.7 12.4 23.3 15.9% 2,284
c = completed; p = pending; L = Lapsed Source: mergermarket
top DeALS & eXpecteD DeALS
28
ASIA-PAcIfIc
Monthly M&A Insider
PIPelIne oF AsIA-PAcIFIc exPected deAlssituation target company sector Potential bidder
companyFinancial adviser to bidder (b); target (t); seller (s)
seller company Market cap/ est. value (us$m)
comments
expected deal
transurban group
construction canada pension plan Investment Board (cppIB); and ontario teachers’ pension plan (otpp)
Lazard (t); UBS Investment Bank (t); goldman Sachs (B); Jpmorgan (B)
6,500 transurban group in november received a conditional and non-binding joint takeover proposal from cppIB and otpp. the Board then evaluated the proposal and rejected it on the original terms. the future fund Board of guardians has subsequently considered supporting the proposal by cppIB and otpp. transurban continues to insist a bona fide proposal is needed before talks can proceed. In may 2010, cppIB and otpp raised its offer from AU$5.25 per transurban share to AU$5.57 per share. However, the revised takeover proposal was again rejected bytransurban as transurban considered that their offer was still too low.
expected Deal
chuo mitsui trust Holdings Inc
financial Services
Sumitomo trust & Banking
5,709 chuo mitsui trust and Sumitomo trust have announced a plan to consolidate the business by creating a holding company by April 2011.
expected Deal
SgIS Songshan co Ltd
Industrials & chemicals
guangdong Hengjian Investment Holding co Ltd
932 SgIS Songshan will raise up to cnY2.5bn from private placement of 570m new shares. Heng Jian Investment will acquire up to 341.69m new shares in the company for a maximum of cnY1.5bn (US$220.6m) and become second largest shareholder.
expected Deal
nufarm Limited
Industrials & chemicals
Sumitomo chemical company Ltd
818 nufarm was a rumoured takeover target for Sumitomo chemical company Ltd; following the completion of a partial offer.
expected Deal
measat global Berhad
tmt measat global network Systems Sdn
482 measat global Bhd received a conditiona voluntary proposal from measat global network Systems Sdn for mYr4.2 per share in cash.
expected Deal
Wai chun mining Industry group co. Ltd.
consumer Undisclosed bidder
404 Wai chun mining has signed a memorandum of understanding in relation to the possible issue of new shares which may lead to a change in control of the company.
expected Deal
redflex Holdings Limited
tmt macquarie group Limited
206 redflex Holdings Limited received an indicative, non-binding and confidential proposal to acquire all of the issued capital of redflex by scheme of arrangement from a wholly owned subsidiary of macquarie group Limited at a price of AU$2.50 per share.
expected Deal
Boom Logistics
transport Archer capital and mcAleese group
200 Boom Logistics, the Australian-listed crane hire business, has received a takeover offer from Archer capital and mcAleese group. Boom Logistics has received two conditional proposals from Archer in April. the company rejected the first bid outright due to its conditionality. Boom Logistics has not yet formalised its response to the second offer of AU$0.52 per Boom Logistics share.
expected deals based on confirmed announcements by companies involved
top DeALS & eXpecteD DeALS
29
ASIA-PAcIfIc
Monthly M&A Insider
LeAgUe tABLeS
vALUeytd
31-Jul-10house value
(us$m)deal count
1 UBS Investment Bank 34,680 32
2 Jpmorgan 33,499 24
3 Deutsche Bank 31,471 27
4 morgan Stanley 30,637 24
5 HSBc Bank 27,471 15
6 macquarie group 24,623 21
7 Barclays capital 19,141 11
8 goldman Sachs 18,412 30
9 Bank of America merrill Lynch 18,109 16
10 credit Suisse 16,865 22
11 nomura Holdings 16,834 11
12 Standard chartered 16,599 8
13 Bnp paribas 15,174 10
14 Lazard 14,179 5
15 china International capital 13,803 8
16 cImB group 12,098 17
17= global Investment House kScc 10,700 1
17= State Bank of India 10,700 1
19 Bmo capital markets 10,282 2
20 citigroup 9,910 14Source: mergermarket
voLUme
the financial adviser league tables by value and volume have been run from 1 January 2010 to 31 July 2010 and exclude lapsed and withdrawn deals. the tables cover all sectors andare based on the geography of either the target, bidder or seller being Asia-pacific-based, excluding Japan.
ytd 31-Jul-10
house value (us$m)
deal count
1 UBS Investment Bank 34,680 32
2 goldman Sachs 18,412 30
3 kpmg 4,065 28
4 Deutsche Bank 31,471 27
5 ernst & Young 2,635 27
6 Jpmorgan 33,499 24
7 morgan Stanley 30,637 24
8 credit Suisse 16,865 22
9 Deloitte 6,880 22
10 macquarie group 24,623 21
11 pricewaterhousecoopers 2,677 21
12 cImB group 12,098 17
13 Bank of America merrill Lynch 18,109 16
14 HSBc Bank 27,471 15
15 rothschild 6,779 15
16 citigroup 9,910 14
17 Barclays capital 19,141 11
18 nomura Holdings 16,834 11
19 Bnp paribas 15,174 10
20 optima capital 715 9Source: mergermarket
toP 20 FInAncIAl AdvIsers – AsIA-PAcIFIc excl JAPAn
toP 20 legAl AdvIsers – AsIA-PAcIFIc excl JAPAnvALUe
ytd 31-Jul-10
house value (us$m)
deal count
1 Herbert Smith/gleiss Lutz/Stibbe 50,166 8
2 Debevoise & plimpton 46,160 3
3 Slaughter and may 44,006 14
4 norton rose 42,269 22
5 Sullivan & cromwell 38,361 6
6 Simpson thacher & Bartlett 37,546 7
7 cravath Swaine & moore 36,988 2
8 Weil gotshal & manges 36,379 5
9 cleary gottlieb Steen & Hamilton 35,950 3
10 Davis polk & Wardwell 31,105 9
11 Allens Arthur robinson 24,154 17
12 mallesons Stephen Jaques 24,072 31
13 Linklaters 21,757 17
14 freehills 21,737 35
15 AZB & partners 19,398 40
16 Skadden Arps Slate meagher & flom 16,038 13
17 Allen & overy 15,909 15
18 Baker & mckenzie 12,336 25
19 Blake Dawson 10,992 15
20 talwar, thakore and Associates 10,700 2Source: mergermarket
voLUme
the legal adviser league tables by value and volume have been run from 1 January 2010 to 31 July 2010 and include lapsed and withdrawn deals. the tables cover all sectors and are based on the geography of either the target, bidder or seller being Asia-pacific-based, excluding Japan.
ytd 31-Jul-10
house value (us$m)
deal count
1 DLA piper 1,430 42
2 AZB & partners 19,398 40
3 freehills 21,737 35
4 mallesons Stephen Jaques 24,072 31
5 Wongpartnership 8,451 31
6 Baker & mckenzie 12,336 25
7 minter ellison 5,906 25
8 kim & chang 3,725 24
9 Jones Day 3,311 24
10 norton rose 42,269 22
11 freshfields Bruckhaus Deringer 4,959 20
12Amarchand & mangaldas & Suresh A Shroff & co 6,028 19
13 clayton Utz 4,435 19
14 Allens Arthur robinson 24,154 17
15 Linklaters 21,757 17
16 Allen & gledhill 5,952 17
17 clifford chance 4,112 16
18 Allen & overy 15,909 15
19 Blake Dawson 10,992 15
20 Slaughter and may 44,006 14Source: mergermarket
30
ASIA-PAcIfIc
Monthly M&A Insider
LeAgUe tABLeS
vALUe
ytd 31-Jul-10
house value (us$m)
deal count
1 nomura Holdings 21,157 422 Jpmorgan 10,713 93 morgan Stanley 7,322 164 Daiwa Securities group 6,683 195 Bank of America merrill Lynch 6,104 46 citigroup 5,467 57 ABeam m&A consulting corp fin 5,228 28 goldman Sachs 4,328 79 UBS Investment Bank 4,014 110 Deutsche Bank 3,521 311 greenhill & co 3,510 312 Lazard 3,390 313 centerview partners 3,301 114 Sangyo Sosei Advisory 3,297 215 mizuho financial group 2,516 25
Source: mergermarket
voLUme
the financial adviser league tables by value and volume have been run from 1 January 2010 to 31 July 2010 and exclude lapsed and withdrawn deals. the tables cover all sectors andare based on the geography of either the target, bidder or seller being Japan-based.
ytd 31-Jul-10
house value (us$m)
deal count
1 nomura Holdings 21,157 42
2 mizuho financial group 2,516 25
3 Daiwa Securities group 6,683 19
4 Sumitomo mitsui financial group 2,071 17
6 morgan Stanley 7,322 16
5 gcA Savvian 1,429 11
7 Jpmorgan 10,713 9
8 goldman Sachs 4,328 7
9 kpmg 732 7
10 pricewaterhousecoopers 624 7
11 citigroup 5,467 5
12 ernst & Young 602 5
13 Bank of America merrill Lynch 6,104 4
14 A.g.S. consulting 254 4
15 Deutsche Bank 3,521 3Source: mergermarket
toP 15 FInAncIAl AdvIsers – JAPAn
vALUe
ytd 31-Jul-10
house value (us$m)
deal count
1 mori Hamada & matsumoto 15,292 36
2 Shearman & Sterling 11,838 8
3 nagashima ohno & tsunematsu 8,384 19
4 Skadden Arps Slate meagher & flom 8,248 7
5 nishimura & Asahi 7,517 20
6 Anderson mori & tomotsune 6,012 11
7 Latham & Watkins 5,235 4
8 gibson Dunn & crutcher 5,131 3
9 kikkawa Law offices 4,774 2
10 morrison & foerster 4,293 10
11 Dewey & LeBoeuf 3,666 2
12 freshfields Bruckhaus Deringer 3,526 5
13 Linklaters 3,450 5
14 Webber Wentzel 2,853 2
15 eversheds 2,822 1Source: mergermarket
voLUme
the legal adviser league tables by value and volume have been run from 1 January 2010 to 31 July 2010 and include lapsed and withdrawn deals. the tables cover all sectors andare based on the geography of either the target, bidder or seller being Japan-based.
ytd 31-Jul-10
house value (us$m)
deal count
1 mori Hamada & matsumoto 15,292 36
2 nishimura & Asahi 7,517 20
3 nagashima ohno & tsunematsu 8,384 19
4 tmI Associates 2,115 12
5 Anderson mori & tomotsune 6,012 11
6 morrison & foerster 4,293 10
7 Shearman & Sterling 11,838 8
8 Skadden Arps Slate meagher & flom 8,248 7
9 Baker & mckenzie 379 7
10 freshfields Bruckhaus Deringer 3,526 5
11 Linklaters 3,450 5
12 AZB & partners 1,889 5
13 kitamura & Hiraga 323 5
14 Latham & Watkins 5,235 4
15 DLA piper 648 4Source: mergermarket
toP 15 legAl AdvIsers – JAPAn
31
ASIA-PAcIfIc
Monthly M&A Insider
trenD grApHS
AsIA-PAcIFIc M&A quArterly trend
vALUe voLUme
0
50,000
100,000
150,000
200,000
Q310*
Q210
Q110
Q409
Q3 09
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q207
Q107
Q406
Q306
Q206
Q106
Q405
Q305
Q2 05
Q 05
Q404
Q304
Q204
Q104
Valu
e (U
S$m
)
0
100
200
300
400
500
600
700
800
Q310*
Q210
Q110
Q409
Q309
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q207
Q107
Q406
Q306
Q206
Q106
Q405
Q305
Q205
Q105
Q404
Q304
Q204
Q104
Num
ber
of d
eals
AsIA-PAcIFIc M&A quArterly MId-MArKet trend
vALUe voLUme
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
Q310*
Q2 10
Q1 10
Q4 09
Q309
Q209
Q1 09
Q408
Q308
Q208
Q1 08
Q407
Q307
Q207
Q107
Q406
Q306
Q2 06
Q1 06
Q405
Q305
Q205
Q1 05
Q404
Q304
Q2 04
Q104
Valu
e (U
S$m
)
0
100
200
300
400
500
Q3 10*
Q210
Q110
Q409
Q309
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q2 07
Q 07
Q406
Q306
Q206
Q106
Q405
Q305
Q205
Q105
Q404
Q304
Q204
Q104
Num
ber
of d
eals
moving average trend line
32
ASIA-PAcIfIc
Monthly M&A Insider
trenD grApHS
AsIA-PAcIFIc M&A sector breAKdown ytd 2010
vALUe voLUme
17.1%
12.0%
7.5%
17.4%
19.7%
6.5%
2.1%
2.6%
6.1%
4.8%
1.2% 2.9%
Industrials & Chemicals
TMT
Consumer
Energy, Mining & Utilities
Financial Services
Business Services
Pharma, Medical & Biotech
Construction
Real Estate
Transport
Leisure
Agriculture
20.5%
13.2%
11.9%
7.3%
9.2%
2.5%
11.2%
6.5%
5.3%
4.9%
4.3%3.0%
Industrials & Chemicals
TMT
Consumer
Energy, Mining & Utilities
Financial Services
Business Services
Pharma, Medical & Biotech
Construction
Real Estate
Transport
Leisure
Agriculture
AsIA-PAcIFIc M&A quArterly PrIvAte equIty trend
vALUe voLUme
0
5,000
10,000
15,000
20,000
25,000
Q3 10*
Q210
Q110
Q409
Q309
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q207
Q107
Q406
Q306
Q206
Q106
Q405
Q305
Q205
Q105
Q404
Q304
Q204
Q104
Valu
e (U
S$m
)
Asia-Pacificbuyouts
Asia-Pacificexits
0
20
40
60
80
100
Q310*
Q210
Q110
Q409
Q309
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q207
Q107
Q406
Q306
Q206
Q106
Q405
Q305
Q205
Q105
Q404
Q304
Q204
Q104
Num
ber
of d
eals
Asia-Pacificbuyouts
Asia-Pacificexits
33
ASIA-PAcIfIc
Monthly M&A Insider
trenD grApHS
AsIA-PAcIFIc M&A geogrAPhIc breAKdown ytd 2010
vALUe voLUme
China
Australia
Japan
South Korea
India
Hong Kong
Singapore
Malaysia
Indonesia
Taiwan
Other
20.6%
6.9%
4.8%
8.6%
3.6%
7.5%
6.1%
2.4%
1.1%
22.9%
15.4%
26.8%
9.9%
10.7%
14.5%
15.4%
5.3%
5.3%
4.1%
4.0%
2.5%
1.6%
China
Australia
Japan
South Korea
India
Hong Kong
Singapore
Malaysia
Indonesia
Taiwan
Other
AsIA-PAcIFIc M&A deAl sIze breAKdown
vALUe voLUme
0
50
100
150
200
250
300
H22010*
H12010
H22009
H12009
H22008
H12008
H22007
H12007
H22006
H12006
H22005
H12005
H22004
H12004
> US$501m
US$251m-US$500m
US$101m-US$250m
US$15m-US$100m
US$5m-US$14.9m
Valu
e (U
S$bn
)
0
300
600
900
1200
1500
H2 2010*
H12010
H22009
H12009
H22008
H12008
H22007
H12007
H22006
H12006
H22005
H12005
H22004
H12004
> US$501m
US$251m-US$500m
US$101m-US$250m
US$15m-US$100m
US$5m-US$14.9m
Value not disclosed
Num
ber
of d
eals
34Monthly M&A Insider
europe
A mergermArket m&A report on
eUrope
the most active sector last July was Industrials & Chemicals, representing circa 18.0% of european m&A activity. this area has historically been the most active in the region, representing 20.0% of the european m&A activity both in 2009 and YtD 2010 and our deal of the month is a tribute to these figures: the €3.70bn take-private acquisition of tomkins by a consortium of Canadian investors.
things are slightly different in terms of m&A value. So far this year, most european m&A value has came from the energy, mining & Utilities space (19.0%), which is represented three times in the top 10 deals of the year-to-date, and twice in the top five deals of July.
The (maybe) biggest European investment by Hong Kong companies on record:energy, mining & Utilities is on the track to lead european m&A in value all year. Indeed, on the 30 July, a binding offer was made by a consortium led by Cheung kong Infrastructure (CkI) and Hongkong electric, the two listed Hong kong-based groups, to acquire the Uk distribution network of eDF for about €6.90bn.
mr. Li ka-shing, the richest man in Hong kong and one of Asia’s wealthiest men, is behind the offer made by the Hong kong consortium. mr. Li ka-shing controls CkI, which itself owns a 39.00% stake in the smaller Hongkong electric. Under the terms of the offer, Hongkong electric and CkI would respectively control two-fifths of eDF’s Uk distribution networks, while mr. Li’s charity foundation would own the remainder.
eDF has granted the consortium a period of exclusivity for the finalisation of the transaction after mr. Li’s offer outbid Scottish & Southern energy and another consortium comprising of sovereign-wealth fund Abu Dhabi Investment Authority, macquarie Capital and Canada pension plan, according to sources close to the deal.
According to media sources, mr. Li ka-shing would raise a £665m (€800m) debt from rBS, Deutsche Bank, Bnp paribas, Barclays, Lloyds, mizuho Bank and Santander to fund the acquisition. Its irrevocable offer is above the £5.00bn (€6.00bn) that eDF was expected to sell its Uk network for and would help to reduce the French electricity giant’s record net debt of €44.00bn, as well as meet in a single transaction its €5.00bn announced disposals target.
the offer remains open for acceptance until 24 october. If the offer is accepted by the French group, in terms of value, energy, mining & Utilities might take a serious lead on other sectors.
Spanish conquistador Santander buys more assets:Financial Services represented, by far, the european sector with the highest value of deals in 2009 (about €87.00bn, representing 28.0% of the european m&A value last year), but the niche has fallen to a disappointing fifth position in the YtD 2010.
the space only represents 11.0% of total european m&A value since the beginning of the year, this is despite Banco Santander’s best efforts to boost m&A within the sector. Indeed, the listed Spanish bank has been on somewhat of a charge this summer, acquiring the remaining 25.00% stake in its mexican subsidiary for about €2.00bn in June; buying the retail banking operations of SeB group in July for €555m; and it acquired 318 of rBS’s Uk branches for nearly €2.00bn on 4 August.
moreover, according to a source close to Bank millennium, Santander has already sent a preliminary approach to acquire the polish bank, which has a market capitalisation of about €1.00bn. In north America, according to one person close to the matter, the Spanish group is considering a deal to buy m&t, the new York state-based bank and according to the Financial times, Banco Santander is also keen on building its presence in Latin America over the next two or three years.
In eUrope, JULY wAS not A greAt montH In termS oF m&A ACtIvItY wItH onLY 296 DeALS AnnoUnCeD – tHe SeConD weAkeSt montH In termS oF DeAL FLow tHIS YeAr, JUSt BeHInD JAnUArY wHen onLY 280 DeALS were InkeD. wHen CompAreD to JULY 2009, (m&A ACtIvItY From JAnUArY-JULY wAS 6.5% Lower tHAn tHIS YeAr), tHe nUmBer oF DeALS AnnoUnCeD wAS 16.0% HIgHer tHAn 2010’S FIgUre.
35
europe
Monthly M&A Insider
Beside its external growth strategy, the Spanish bank is offering greater power to local units through Ipos of its individual subsidiaries in their main markets. According to the wall Street Journal, Santander Brazil’s Ipo in 2009 gave the bank very good publicity and raised more than €5.00bn in capital for the parent company, as well as lifting the worth of the franchise. Like HSBC, Santander follows the strategy of having foreign units work as subsidiaries instead of branches in the belief that it is a good way of identifying the franchise as local, instead of foreign.
the strategy that began in Brazil last year is now being considered for the Uk as well as other markets. the Spanish group is actually consolidating the operations it has acquired in the Uk – Abbey, Alliance & Leicester and part of Bradford & Bingley. According to the Financial times, Santander is considering a part-listing of Santander Uk as early as this autumn to help fund its acquisition strategy. According to bankers, floating 20.00% of the business could raise £3.00bn (€3.60bn).
In the end, if Santander’s acquisitions are consolidating the sector, the Spanish bank is, in a way, decentralising.
eUrope
36
europe
Monthly M&A Insider
Target: tomkins plc Announced: 27-Jul-10
Bidder: onex partners Lp; and Canada pension plan Investment Board Deal value: €3.67bn
Seller: - Deal nature: Cross-border, IBI, public, take-private, transatlantic
pinafore Acquisitions Limited, the consortium comprising onex partners Lp and Canadian pension plan Investment board, and tomkins plc, the Uk engineering company, have agreed on the terms for a recommended scheme to acquire the entire issued and to be issued ordinary share capital of tomkins plc.
STrucTurE:• the transaction will be conducted via a scheme of
arrangement under Uk law.
TErMS:• Shareholders of tomkins plc will receive £3.25 in cash per
each share held.
• Holders of tomkins plc ADrs will receive £13.00 in cash per each ADr held.
• the offer values the fully diluted capital of tomkins plc at £2.89bn.
• It represents a premium of 5.7% over tomkins plc’s closing share price of £3.075 on 26-Jul-10, the last trading day prior to the firm announcement of the offer.
• It represents a premium of 41.1% over tomkins plc’s closing share price of £2.303 on 16-Jul-10, the last trading day prior to tomkins receiving an approach from the consortium.
BAcKgrounD:• on 19-Jul-10, tomkins plc received an approach about
a possible offer for the company from a consortium comprising onex partners Lp and the Canada pension plan Investment Board to acquire the Company at £3.25 in cash per share. the Board has considered the terms of the proposal and allowed the consortium to conduct due diligence on the company.
PoST DEAl DETAIlS:• If pinafore receive the necessary acceptances and all
conditions are fulfilled, then they will apply to de-list tomkins plc from the London stock exchange.
• It is expected that the tomkins ADr programme will be terminated following the Acquisition becoming effective and the ADrs are to be delisted from the nYSe and de-registered with the SeC.
FInAncIng:• the cash consideration payable will be financed through a
combination of equity and debt financing.
• the debt financing, consists of facilities of US$3.00bn, arranged and fully underwritten by Bank of America merrill Lynch, Citigroup global markets Inc., Barclays Capital, rBC Capital markets and UBS Securities LLC.
• equity financing of approximately US$2.20bn, will be provided in equal shares by onex and CppIB. onex’s equity financing will be funded from its onex partners III, L.p. private equity fund and from onex Corporation. CppIB’s equity financing will be funded from its existing cash resources.
conDITIonS:• tomkins egm approval
• High Court approval
• Clearance by competition authority in Canada, China, Japan, mexico, russia, South korea, Ukraine, and the United States
• eC phase I clearance
DeAL oF tHe montH
37
europe
Monthly M&A Insider
DeAL oF tHe montH
Exit multiples – Y/E 31-Mar-10 Premium analysis
Multiples Value (€m) offer price per share (€) 3.90
revenue 1.3x 2,910 1 day before 5.69%
EBITDA 18.7x 197 1 month before 37.30%
EBIT 62.3x 59 1 day after 0.31%
Earnings - 8 Pre-rumour 43.90%
Advisers
Target/Seller Bidder
Financial morgan StanleyJpmorgan CazenoveJamieson Corporate Finance
Financial CitigroupUBS Investment BankrBC Capital marketsBarclays Capital
legal Slaughter and may legal Latham & watkinsFreshfields Bruckhaus Deringer
Pr Finsbury group Pr maitland (Amo)
Mergermarket/dealreporter Intelligence
27-Jul-10 tomkins: Standard Life continues opposition to bid
22-Jul-10 tomkins: Standard Life says 325p is too low from onex and Cpp
19-Jul-10 tomkins: Lower future earnings factored into 325p/share bid
08-Jan-10 tomkins takeover chatter unfounded, people familiar say
10-Dec-09 tomkins bid rumours ‘wide of the mark’, person says
Timetable and expected events
regulatory Date notes
Announcement 27-Jul-10 Yes
Scheme of arrangement document issued
6-Aug-10 Yes
Court meeting estimates: normally 1 month after Scheme of Arrangement (SoA) document issued, simple majority of voting minority shareholders present and 75.0% of value of votes cast required
High court estimates: normally 3-4 weeks after Court meeting & egm, ref sanction of SoA
effective date estimates: normally next trading day from High Court sanction
Settlement estimates: 14 calendar days from effective Date at the latest, 180 calendar day after SoA doc issued
end date estimates: normally next trading day from High Court sanction
company Events
Target ex-vote date estimates: 4 trading days before egm
Target ex-record date estimates: 2 trading days before egm
Target eGM estimates: alongside Scheme meeting, normally 1 month from SoA doc issued; 75.0% of votes cast required
38
europe
Monthly M&A Insider
ToP 15 EuroPEAn AnnouncED DEAlS YTD 31 JulY 2010Announced Status Target company Sector Bidder company Seller company Exit multiples (x) Bid premia
1-day beforeDeal value
(€m)revenue EBITDA P/E
4-Jan-10 p Alcon Inc (52.00% Stake)
pharma, medical & Biotech
novartis Ag nestle SA 8.0 20.9 26.9 9.5% 18,247
30-Jun-10 p oJSC polyus gold energy, mining & Utilities
kazakhgold group Limited
9.8 22.8 35.0 5.4% 8,367
5-Jan-10 C nk russneft oAo energy, mining & Utilities
mikhail gutseriyev (private Investor)
en+ group Ltd 4,595
14-Jun-10 C JSC Uralkali (53.20% Stake)
Industrials & Chemicals
kaliha Finance Limited; Aerellia Investments Limited; and Becounioco Holdings Limited
madura Holding Limited
10.5 21.7 37.9 21.4% 4,254
18-mar-10 p ratiopharm gmbH pharma, medical & Biotech
teva pharmaceutical Industries Ltd
2.6 - 4,200
27-Jul-10 p tomkins plc Industrials & Chemicals
onex partners Lp; and Canada pension plan Investment Board
1.3 18.7 5.7% 3,672
8-Apr-10 p Iberia Lineas Aereas de espana SA
transportation British Airways plc 0.9 0.9% 3,598
24-Jun-10 p AXA SA (Uk life and pensions businesses)
Financial Services
resolution Limited AXA SA n/a n/a 20.4 - 3,330
20-Jan-10 C Areva t&D SA Industrials & Chemicals
Schneider electric SA; and Alstom SA
ArevA SA 0.6 - 3,180
21-Jul-10 p SSL International plc
Consumer reckitt Benckiser plc 3.4 19.5 37.4 32.8% 3,046
24-Feb-10 C edenred SA Business Services
Accor SA (Shareholders)
Accor SA 3.7 9.2 2,937
22-Apr-10 p Arriva plc transportation Deutsche Bahn Ag 0.8 7.7 14.6 1.2% 2,819
23-Jun-10 p Cognis gmbH Industrials & Chemicals
BASF Se permira; gS Capital partners; and Sv Life Sciences
0.9 7.5 28.0 - 2,408
15-mar-10 C tommy Hilfiger Corporation
Consumer phillips-van Heusen Corporation
Apax partners LLp 1.3 7.9 - 2,200
21-Jun-10 p Subsea 7 Inc energy, mining & Utilities
Acergy m.S. Limited 1.2 5.5 10.0 1.8% 2,008
C = Completed; p = pending; L = Lapsed Source: mergermarket
top DeALS & eXpeCteD DeALS
39
europe
Monthly M&A Insider
top DeALS & eXpeCteD DeALS
ToP 5 EuroPEAn AnnouncED DEAlS oF THE MonTH (JulY 2010)Announced Status Target company Sector Bidder company Seller company Exit multiples (x) Bid premia
1-day beforeDeal value
(€m)revenue EBITDA P/E
27-Jul-10 p tomkins plc Industrials & Chemicals
onex partners Lp; and Canada pension plan Investment Board
1.3 18.7 5.7% 3,672
21-Jul-10 p SSL International plc
Consumer reckitt Benckiser plc 3.4 19.5 37.4 32.8% 3,046
29-Jul-10 p bwin Interactive entertainment Ag
tmt partygaming plc 4.0 18.4 35.3 31.9% 1,688
1-Jul-10 p endesa Distribucion electrica SL (electricity distribution assets)
energy, mining & Utilities
red electrica de espana SA
endesa Distribucion electrica SL
- 1,270
7-Jul-10 p northern Ireland electricity plc
energy, mining & Utilities
electricity Supply Board of Ireland
viridian group Limited
- 1,243
C = Completed; p = pending; L = Lapsed Source: mergermarket
40
europe
Monthly M&A Insider
Situation Target company Sector Potential bidder company
Financial adviser to bidder (B); target (T); seller (S)
Seller company Market cap/ est. value (€m)
comments
expected deal
eDF energy plc (Uk network activities)
energy, mining & Utilities
Consortium of Cheung kong Infrastructure Holdings Ltd, Hongkong electric Holdings Ltd, and Li ka-Shing Foundation
electricite de France SA
6,900 eDF group has received a €6.90bn irrevocable offer and has granted exclusivity to the Cheung kong group in respect of its Uk electricity distribution networks.
expected deal
Dana petroleum plc
energy, mining & Utilities
korea national oil Corporation
Bank of America merrill Lynch (B); royal Bank of Scotland group (t); rBC Capital markets (t)
2,161 Dana petroleum and its suitor korea national oil Corporation (knoC) are in talks over knoC’s £18 per share indicative offer, according to people close to both companies.
expected deal
Bank millennium SA
Financial Services
Banco Santander SA
Banco Comercial portugues SA
1,076 Bank millennium's portuguese parent company Banco Commercial portugues (BCp) has received a preliminary approach from Spain’s Santander, said a source at the polish-listed lender.
potential takeover target
Uktv tmt BBC worldwide Limited
virgin media Inc
420 BBC worldwide may look to increase its 50.00% stake in Uktv, but is not considering taking full ownership of the company, a source close to the situation said.
potential takeover target
gascan - gases Combustiveis SA
Business Services
the riverside Company; and gALp energia SgpS SA
Banco millennium BCp Investimento (S)
explorer Investments SCr SA
100 gascan, the portuguese distributor of liquefied petroleum gas (Lpg), is up for sale by portuguese private equity firm explorer, who have mandated BCp and Cuatrecasas.
note: expected deals based on confirmed announcements by companies involved
PIPElInE oF EuroPEAn ExPEcTED DEAlS
top DeALS & eXpeCteD DeALS
41
europe
Monthly M&A Insider
LeAgUe tABLeS
vALUeYTD
31-Jul-10House Value
(€m)Deal count
1 goldman Sachs 74,712 522 Credit Suisse 74,471 663 Citigroup 62,551 364 morgan Stanley 57,427 655 Jpmorgan 54,947 486 Deutsche Bank 46,868 487 Bank of America merrill Lynch 38,532 278 Lazard 35,697 579 UBS Investment Bank 34,465 4410 rothschild 34,078 8411 Barclays Capital 34,052 2812 greenhill & Co 22,257 1013 HSBC Bank 19,246 2114 Sg 17,352 1215 nomura Holdings 15,181 2316 Bnp paribas 12,608 2517 Credit Agricole CIB 11,674 1418 rBC Capital markets 10,952 1619 Bmo Capital markets 9,318 320 Blackstone group Holdings 8,765 4
Source: mergermarket
voLUme
the financial adviser league tables by value and volume have been run from 1 January 2010 to 31 July 2010 and exclude lapsed and withdrawn deals. the tables cover all sectors andare based on the geography of either the target, bidder or seller being europe-based.
YTD 31-Jul-10
House Value (€m)
Deal count
1 rothschild 34,078 84
2 kpmg 5,746 73
3 pricewaterhouseCoopers 6,188 72
4 Credit Suisse 74,471 66
5 morgan Stanley 57,427 65
6 Deloitte 4,197 58
7 Lazard 35,697 57
8 goldman Sachs 74,712 52
9 Jpmorgan 54,947 48
10 Deutsche Bank 46,868 48
11 UBS Investment Bank 34,465 44
12 Citigroup 62,551 36
13 ernst & Young 1,393 35
14 DC Advisory partners 4,117 30
15 Barclays Capital 34,052 28
16 Bank of America merrill Lynch 38,532 27
17 Bnp paribas 12,608 25
18 global m&A 80 24
19 nomura Holdings 15,181 23
20 HSBC Bank 19,246 21Source: mergermarket
ToP 20 FInAncIAl ADVISErS
vALUeYTD
31-Jul-10House Value
(€m)Deal count
1 Sullivan & Cromwell 71,462 21
2 Simpson thacher & Bartlett 57,082 25
3 Slaughter and may 56,363 37
4 Cravath Swaine & moore 55,605 11
5 Skadden Arps Slate meagher & Flom 51,633 28
6 Allen & overy 48,259 87
7 Cleary gottlieb Steen & Hamilton 46,587 30
8 Linklaters 42,637 94
9 Freshfields Bruckhaus Deringer 41,379 72
10 Herbert Smith/gleiss Lutz/Stibbe 41,168 40
11 weil gotshal & manges 40,486 32
12 Davis polk & wardwell 37,364 12
13 Debevoise & plimpton 36,611 6
14 norton rose 33,661 25
15 Blake, Cassels & graydon 30,007 13
16 Latham & watkins 27,303 42
17 wachtell, Lipton, rosen & katz 26,732 6
18 Dewey & LeBoeuf 22,637 33
19 Homburger 21,421 9
20 Uria menendez 18,310 19Source: mergermarket
voLUme
the legal adviser league tables by value and volume have been run from 1 January 2010 to 31 July 2010 and exclude lapsed and withdrawn deals. the tables cover all sectors andare based on the geography of either the target, bidder or seller being europe-based.
YTD 31-Jul-10
House Value (€m)
Deal count
1 Linklaters 42,637 94
2 Allen & overy 48,259 87
3 DLA piper 4,189 80
4 Freshfields Bruckhaus Deringer 41,379 72
5 CmS 4,920 64
6 Clifford Chance 17,529 56
7 Jones Day 8,466 45
8 SJ Berwin 6,187 44
9 Latham & watkins 27,303 42
10 Herbert Smith/gleiss Lutz/Stibbe 41,168 40
11 Hogan Lovells 8,852 40
12 Baker & mckenzie 10,350 38
13 mannheimer Swartling 6,106 38
14 Slaughter and may 56,363 37
15 white & Case 7,013 35
16 Dewey & LeBoeuf 22,637 33
17 weil gotshal & manges 40,486 32
18 Cleary gottlieb Steen & Hamilton 46,587 30
19 vinge 3,196 30
20 Skadden Arps Slate meagher & Flom 51,633 28Source: mergermarket
ToP 20 lEgAl ADVISErS
42
europe
Monthly M&A Insider
LeAgUe tABLeS
vALUe
YTD 31-Jul-10
House Value (€m)
Deal count
1 onex partners 3,672 1
2 Advent International 1,818 4
3 CvC Capital partners 1,600 3
4 tpg Capital 1,559 2
5 triton partners 1,456 4
6 kohlberg kravis roberts & Co 1,423 4
7 Cinven 1,401 2
8 gS Capital partners 1,200 1
9 niam 1,088 1
10 Bridgepoint Capital 898 4Source: mergermarket
voLUme
the private equity buyout activity tables by value and volume are based on private equity firms advising the bidder on buyout deals where the dominant geography of the target company is europe-based. the tables by value and volume have been run from 1 January 2010 to 31 July 2010 and exclude lapsed and withdrawn deals.
YTD 31-Jul-10
House Value (€m)
Deal count
1 HgCapital 606 8
2 Lloyds tSB Development Capital 289 6
3 edmond de rothschild Investment partners 183 5
4 Barclays private equity 160 5
5 Sovereign Capital partners 50 5
6 procuritas 28 5
7 Capman group - 5
8 Advent International 1,818 4
9 triton partners 1,456 4
10 kohlberg kravis roberts & Co 1,423 4Source: mergermarket
ToP 10 PrIVATE EquITY FIrMS BY EuroPEAn BuYouTS
vALUe
YTD 31-Jul-10
House Value (€m)
Deal count
1= permira 2,408 2
1= Sv Life Sciences 2,408 2
3 gS Capital partners 2,408 1
4 Apax partners 2,200 3
5 the Carlyle group 1,879 4
6 riverstone Holdings 1,759 1
7 Candover Investments 1,200 2
8 3i group 1,133 2
9 montagu private equity 1,117 2
10 Bridgepoint Capital 1,074 1Source: mergermarket
voLUme
the private equity exit activity tables by value and volume are based on private equity firms advising the vendor on exit deals where the dominant geography of the target company is europe-based. the tables by value and volume have been run from 1 January 2010 to 31 July 2010 and exclude lapsed and withdrawn deals.
YTD 31-Jul-10
House Value (€m)
Deal count
1 the Carlyle group 1,879 4
2 ISIS private equity partners 44 4
3 Apax partners 2,200 3
4= Duke Street 404 3
4= parcom Capital 404 3
6 Barclays private equity 363 3
7 Azulis Capital 150 3
8 endless Investments 28 3
9= Capman group - 3
9= perfectis private equity - 3Source: mergermarket
ToP 10 PrIVATE EquITY FIrMS BY EuroPEAn ExITS
europe
Monthly M&A Insider 43
trenD grApHS
EuroPEAn M&A quArTErlY TrEnD
vALUe voLUme
0
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
450,000
500,000
Q310*
Q210
Q110
Q409
Q309
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q207
Q107
Q406
Q306
Q206
Q106
Q405
Q305
Q205
Q105
Q4 04
Q3 04
Q2 04
Q104
Valu
e (€
m)
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
Q310*
Q210
Q110
Q409
Q309
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q207
Q107
Q406
Q306
Q206
Q106
Q405
Q305
Q205
Q105
Q404
Q304
Q204
Q104
Num
ber
of d
eals
EuroPEAn M&A quArTErlY MID-MArKET TrEnD
vALUe voLUme
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
Q310*
Q210
Q110
Q409
Q309
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q207
Q107
Q406
Q306
Q206
Q106
Q405
Q305
Q205
Q105
Q404
Q304
Q204
Q104
Valu
e (€
m)
0
100
200
300
400
500
600
700
Q310*
Q210
Q110
Q409
Q309
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q207
Q107
Q406
Q306
Q206
Q106
Q405
Q305
Q205
Q105
Q404
Q304
Q204
Q104
Num
ber
of d
eals
moving average trend line
europe
Monthly M&A Insider
EuroPEAn M&A SEcTor BrEAKDown YTD 2010
vALUe voLUme
14.9%
0.3%0.5%
14.3%
1.7%2.2%
5.3%3.4%
11.1%
10.7%
5.3%
10.9%
19.3%
Industrials & Chemicals
Consumer
TMT
Business Services
Financial Services
Energy, Mining & Utilities
Pharma, Medical & Biotech
Construction
Leisure
Transportation
Real Estate
Agriculture
Defence
15.6%
20.4%
1.0%0.4%3.2%
1.7%
3.8%
7.1%
4.8%
11.0%
9.3%
8.2%
13.0%
Industrials & Chemicals
Consumer
TMT
Business Services
Financial Services
Energy, Mining & Utilities
Pharma, Medical & Biotech
Construction
Leisure
Transportation
Real Estate
Agriculture
Defence
trenD grApHS
EuroPEAn M&A quArTErlY PrIVATE EquITY TrEnD
vALUe voLUme
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
90,000
100,000
Q310*
Q210
Q110
Q409
Q309
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q207
Q107
Q406
Q306
Q206
Q106
Q405
Q305
Q205
Q105
Q404
Q304
Q204
Q104
Valu
e (€
m)
European buyouts
European exits
0
50
100
150
200
250
300
350
400
Q310*
Q210
Q110
Q409
Q309
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q207
Q107
Q406
Q306
Q206
Q106
Q405
Q305
Q205
Q105
Q404
Q304
Q204
Q104
Num
ber
of d
eals
European buyouts
European exits
44
europe
Monthly M&A Insider 45
EuroPEAn M&A DEAl SIzE BrEAKDown
vALUe voLUme
0
50
100
150
200
250
300
350
400
450
500
550
600
650
700
H22010*
H12010
H22009
H12009
H22008
H12008
H22007
H12007
H22006
H12006
H22005
H12005
H22004
H12004
> €501m
€251m-€500m
€101m-€250m
€15m-€100m
€5m-€14.9m
Valu
e (€
bn)
0
500
1,000
1,500
2,000
2,500
3,000
3,500
H22010*
H12010
H22009
H12009
H22008
H12008
H22007
H12007
H22006
H12006
H22005
H12005
H22004
H12004
> €501m
€251m-€500m
€101m-€250m
€15m-€100m
€5m-€14.9m
Value not disclosed
Num
ber
of d
eals
trenD grApHS
EuroPEAn M&A gEogrAPHIc BrEAKDown YTD 2010
vALUe voLUme
Iberia
Benelux
Italy
Other
SEE
UK & Ireland
Nordic
France
CEE
Germany
9.0%
10.8%
7.4%
9.1%
8.1%
6.3%
2.5%
2.8%
17.1%
27.8%
11.7% 7.7%
6.7%
5.3%
5.2%
12.6%
3.1%
22.9%
12.3%
12.3%
Iberia
Benelux
Italy
Other
SEE
UK & Ireland
Nordic
France
CEE
Germany
46
Mid
dle east &
africa
THE MIDDLE EAST & AFRICA
A MERgERMARkET M&A REpoRT on
Monthly M&A Insider
nipon Telegraph and Telecom have made an offer to acquire the South African-listed IT Company Dimension Data in a US$2.80bn deal. Following the announcement, Dimension’s shares jumped over 18.0%. The rdeal rationale was hinted at by nTT president Satoshi Miura in a BBC interview when he stated that Dimension’s brand power in emerging markets is stronger than nTT’s. Although, there is not much overlap between the operations of the two firms, nTT intends to make Dimension Data’s available to its existing customers in order to strengthen the services it is offering and gain access to Africa, Latin America and the Middle East markets.
Another telecom’s deal last month saw the Indian telecom giant Bharti complete the acquisition of Zain Africa, which has operations in 15 African countries, valued at US$10.70bn.
Additional African telecom deals look set to be in the pipeline with the Moroccan government looking to sell its 8.00% stake in Maroc Telecom. The stake has an estimated value of around US$1.80bn. Currently, the majority of the Maroc is held by the French-listed telecom firm Vivendi SA, who hold a 53.00% stake, and the Moroccan telecom firm Etat marocain who own 30.00%. other deals expected to complete soon are the ongoing privatisations of guinea’s state-owned telecom company Sotelgui SA and the Republic of Benin’s government-owned Benin Telecom. Maroc Telecom has also expressed interest in these privatisations.
Meanwhile in other sectors, Bp has begun to try and secure its position in anticipation of claims resulting from the gulf of Mexico oil spill, repairing its cash position, via an asset disposal plan. The first deal has seen the sale of US$7.00bn worth of energy assets, including their Egyptian business and other exploration concessions in the Western Desert and East Badr El-din to the US-based Apache Corp for US$650m.
There is a slight stir in the MEA Financial Services sector as there is expected to be a consolidation of Qatari banks. The listed International Bank of Qatar is in preliminary talks with the Al-khalij Commercial bank to merge their operations and although the valuation process and due diligence procedure is yet to be completed, the merger is expected to create an entity with US$11.10bn worth of assets. The transaction is expected to be finalised either this year or in 2011.
According to mergermarket data, the TMT, Financial Services, Consumer and Energy, Mining & Utilities sectors represent around 56.0% of overall activity in the region by volume for the year-to-date. Similarly, the TMT and Energy, Mining & Utilities spaces witnessed the largest deal values, constituting 52.0% of overall activity alone, suggesting that the focus on emerging markets will continue to largely concentrate on these sectors.
For the year-to-date on the outbound M&A front, Israel and South Africa have been the most active investors with 33 and 45 deals, respectively. Within the MEA region, South Africa carried out the largest number of deals with 38.
JULy SAW THE SEConD LARgEST TRAnSACTIon In THE MIDDLE EAST AnD AFRICA (MEA) So FAR THIS yEAR AnD THE FIRST DEAL In SUB-SAHARAn AFRICA By A JApAnESE TELECoM CoMpAny.
47
Mid
dle east &
africa
Monthly M&A Insider
Target: Dimension Data Holdings plc Announced: 11-Jun-10
Bidder: nippon Telegraph and Telephone Corporation Deal value: US$2.82bn
Deal nature: Cross-border, public
DESCRIPTION • nTT group, the Japanese telecommunications company,
has announced it will acquire the entire outstanding share capital of Dimension Data, the South African IT infrastructure services company. The transaction will be conducted via a recommended public offer under Uk law.
TERMS• Dimension Data shareholders will receive £1.20 (US$1.86)
per each share held.
• The offer values the existing issued ordinary share capital of Dimension Data at £2.05bn.
• The offer represents a premium of 18.1% to Dimension Data’s £1.016 closing price on 14-Jul-10, the last day before the offer announcement.
IRREVOCABLES • Dimension Data directors have irrevocably undertaken
to accept the offer in respect of their own beneficial holdings, representing in aggregate approximately 1.1%.
• nTT has received irrevocable undertakings from the following institutional shareholders: VenFid DD Holdings Limited (25.19%); Allan gray limited (discretionary -4.54%, non-discretionary -21.21%).
• Therefore, total irrevocables amount to 50.95%
CONDITIONS• 90.0% acceptances
• EC
• South African Competition Authority
• Independent Communication Authority (RSA)
• HSR (US)
• CFIUS clearance received
DEAL oF THE MonTH
Advisers
Target/Seller Bidder
Financial JpMorgan Cazenovenomura Holdings
Financial Morgan Stanley
Legal Eversheds Legal LinklatersWebber Wentzel
PR FD PR
Exit multiples – Y/E 30-Jun-09 Premium analysis
Multiples Value (US$m) Offer price per share (US$) 1.86
Revenue 0.7x 3,973 1 day before 18.11%
EBITDA 11.5x 246 1 month before 19.76%
EBIT 154.7x 193 1 day after -2.04%
Earnings 0.2x 145 Pre-rumour n/a
48
Mid
dle east &
africa
Monthly M&A Insider
DEAL oF THE MonTH
mergermarket/dealReporter Intelligence
3-Aug-10 Dimension Data/nTT offer document expected to be issued next week
29-Jul-10 DD/nTT: Deal to be notified in SA and US soon, nTT official says analysis
20-Jul-10 Dimension Data: Venfin shareholder meeting 13-Aug-10
16-Jul-10 Dimension Data: SA competition review expected to take 2-3 months
15-Jul-10 Dimension Data/nTT: Competition filings already started
15-Jul-10 Dimension Data: nTT offer unsolicited; irrevocable deadline 'sufficient'
Timetable and expected events
Regulatory Date Notes
ec notification 19-Jul-10 y
ec clearance provisional deadline
24-Aug-10 under EC Simplified procedure
south african competition commission and competition tribunal
South African Competition Commission; formally 60/85 td for decision from filing: 40/55 td for SACC recommendation to Tribunal; 10/20 td for Tribunal hearing; 10 td for decision (20 td for publication of reasoning) - in practice decision within 10td from SACC recommendation, i.e. 50/65 td from filing
Offer timetable
announcement 15-Jul-10 y
soa doc issued dealReporter est.: 12-Aug-10 latest 28 cd from announcement
court meeting dealReporter est.: 13-Sep-10 normally 1m after SoA doc issued, simple majority of voting minority shareholders present and 75.0% of value of votes cast required
High court dealReporter est.: 11-oct-10, normally 3-4w after Court Meeting & EgM, ref sanction of SoA
effective date dealReporter est.: 12-oct-10, normally next td from High Court sanction
settlement dealReporter est.: 26-oct-10, latest 14 cd from Effective Date
end date dealReporter est.: 8-Feb-11, normally 180 cd after SoA doc issued
Company events
target ex-vote date dealReporter est.: 7-Sep-10, 4td before EgM
target ex-record date dealReporter est.: 09-Sep-10, 2td before EgM
target eGM dealReporter est.: 13-Sep-10, alongside Scheme Meeting, normally 1m from SoA doc issued; 75.0% of votes cast required
49
Mid
dle east &
africa
Monthly M&A Insider
TOP 15 MIDDLE EASTERN & AFRICAN ANNOUNCED DEALS FOR YTD 31 JULY 2010Announced Status Target company Sector Bidder company Seller company Exit multiples (x) Bid premia
1-day beforeDeal value
(US$m)Revenue EBITDA P/E
30-Mar-10 C Zain Africa BV TMT Bharti Airtel Limited Mobile Telecommunications Company k.S.C.
11.2 - 10,700
15-Jul-10 p Dimension Data Holdings plc
TMT nippon Telegraph and Telephone Corporation
0.7 11.5 0.2 18.1% 2,822
18-Feb-10 p Tsogo Sun Holdings pty Ltd
Leisure gold Reef Resorts Limited
Hosken Consolidated Investments Limited; and SABMiller plc
19.7 21.9 59.0 - 2,721
28-Mar-10 p Sonangol Sinopec International Limited (55.00% stake)
Energy, Mining & Utilities
Sinopec Corporation Hongkong International Limited
Sinopec overseas oil & gas Limited
- 2,457
31-Mar-10 p Momentum group Limited
Financial Services
Metropolitan Life Limited
FirstRand Limited n/a n/a - 2,408
10-May-10 p Anglo American Zinc Energy, Mining & Utilities
Hindustan Zinc Limited
Anglo American plc 2.0 6.3 - 1,338
25-Mar-10 p Hyprop Investments Limited (66.70% stake)
Real Estate Redefine Income Fund Limited
15.3 2.5% 942
21-Mar-10 C Qatar Shipping Company QSC
Transportation Qatar navigation Company QSC
-24.0% 917
10-Jan-10 C Qatar Real Estate Investment Co
Real Estate Barwa Real Estate Company QSC
n/a n/a 10.1 30.6% 862
20-Jul-10 p Bp plc (Western Desert business concessions and East Badr El-din exploration concession in Egypt)
Energy, Mining & Utilities
Apache Corporation Bp plc 650
11-Jul-10 p Aabar Investments pJSC
Financial Services
International petroleum Investment Company
n/a n/a 3.3 545
20-May-10 C Shadeed Iron & Steel LLC
Industrials & Chemicals
Jindal Steel & power Ltd
Al ghaith Holding pJSC
- 464
10-Mar-10 C Foodcorp (proprietary) Limited (77.00% stake)
Consumer new Foodcorp Holdings (proprietary) Limited
pamodzi Investment Holdings (proprietary) Limited
0.6 5.8 - 453
18-Jan-10 p Bank Audi SAL - Audi Saradar group (13.95% stake)
Financial Services
M1 group Ltd EFg-Hermes Holding Company
n/a n/a 3.4% 450
15-Mar-10 C kingdom Hotel Investments (43.90% stake)
Leisure kingdom Holding Company
4.1 14.3 0.4 25.0% 375
C = Completed; p = pending; L = Lapsed Source: mergermarket
Top DEALS & ExpECTED DEALS
50
Mid
dle east &
africa
Monthly M&A Insider
Situation Target company Sector Potential bidder company Financial adviser to bidder (B); target (T); seller (S)
Seller company Market cap/ est.
value (US$m)
Comments
Rumoured takeover
International Bank of Qatar
Financial Services
Al-khalij Commercial Bank
Simmons & Simmons (B), Barclays Bank (B)
11,100 Al khalij to be advised by Barclays, Simmons & Simmons on its merger with IBQ.
potential takeover target
Maroc Telecom (8.00% stake)
TMT government of Morocco
1,800 Moroccan government is planning to sell up to an 8.00% stake in the Moroccan telecom company Maroc Telecom.
Rumoured takeover
Amraz Industrials & Chemicals
Cargal group 127 Cargal, the privately held Israeli packaging company, is holding talks to acquire the Israeli plastic packaging firm Amraz.
potential takeover target
Days Inn Hotel Ramallah
Leisure Tiger group 22 Tiger group, a palestine-based investment company, is considering bringing on board a strategic investor to help complete its Days Inn Hotel in Ramallah.
Expected deals based on confirmed announcements by companies involved
PIPELINE OF MIDDLE EASTERN & AFRICAN ExPECTED DEALS
Top DEALS & ExpECTED DEALS
TOP 5 MIDDLE EASTERN & AFRICAN ANNOUNCED DEALS OF ThE MONTh (JULY 2010)Announced Status Target company Sector Bidder company Seller company Exit multiples (x) Bid premia
1-day before
Deal value
(US$m)Revenue EBITDA P/E
15-Jul-10 p Dimension Data Holdings plc
TMT nippon Telegraph and Telephone Corporation
0.7 11.5 0.2 18.1% 2,822
20-Jul-10 p Bp plc (Western Desert business concessions and East Badr El-din exploration concession in Egypt)
Energy, Mining & Utilities
Apache Corporation Bp plc 650
11-Jul-10 p Aabar Investments pJSC
Financial Services
International petroleum Investment Company
n/a n/a 3.32 545
4-Jul-10 C Link Dot net; and Link Egypt
TMT Egyptian Company for Mobile Services
orascom Telecom Holding SAE
130
13-Jul-10 p CIC Holdings Limited Industrials & Chemicals
Imperial Holdings Limited
0.3 7.0 0.1 15.2% 96
C = Completed; p = pending; L = Lapsed Source: mergermarket
51
Mid
dle east &
africa
Monthly M&A Insider
LEAgUE TABLES
VALUEYTD
31-Jul-10house Value
(US$m)Deal count
1 UBS Investment Bank 15,795 4
2 Barclays Capital 14,359 4
3 Morgan Stanley 13,810 4
4 goldman Sachs 12,126 10
5 Standard Chartered 11,650 3
6 HSBC Bank 11,617 3
7 Bnp paribas 10,700 2
8= global Investment House 10,700 1
8= State Bank of India 10,700 1
10 Royal Bank of Scotland group 5,715 2
11 Commerzbank 5,715 1
12 Lazard 4,791 5
13 JpMorgan 4,631 4
14 Deutsche Bank 4,596 4
15 Rand Merchant Bank 4,589 8Source: mergermarket
VoLUME
The financial adviser league tables by value and volume have been run from 1 January 2010 to 31 July 2010 and exclude lapsed and withdrawn deals. The tables cover all sectors and are based on the geography of either the target, bidder or seller being Middle East (including Israel) & African-based.
YTD 31-Jul-10
house Value (US$m)
Deal count
1 goldman Sachs 12,126 10
2 Rand Merchant Bank 4,589 8
3 Lazard 4,791 5
4 Investec 4,038 5
5 UBS Investment Bank 15,795 4
6 Barclays Capital 14,359 4
7 Morgan Stanley 13,810 4
8 JpMorgan 4,631 4
9 Deutsche Bank 4,596 4
10 Citigroup 1,413 4
11 nedbank Capital 295 4
12 Deloitte 100 4
13 pricewaterhouseCoopers 78 4
14 Standard Chartered 11,650 3
15 HSBC Bank plc 11,617 3Source: mergermarket
TOP 15 FINANCIAL ADVISERS – MIDDLE EAST & AFRICA
VALUEYTD
31-Jul-10house Value
(US$m)Deal count
1 Linklaters 16,419 8
2 Herbert Smith/gleiss Lutz/Stibbe 15,435 5
3 Allen & overy 13,573 6
4 AZB & partners 11,490 5
5 Talwar, Thakore and Associates 10,700 1
6 Webber Wentzel 7,488 11
7 Edward nathan Sonnenbergs 6,815 7
8 Freshfields Bruckhaus Deringer 6,396 5
9 Sullivan & Cromwell 6,365 3
10 Stikeman Elliott 5,748 2
11= goERg Rechtsanwaelte 5,715 1
11= kirkland & Ellis 5,715 1
11= noerr 5,715 1
11= Willkie Farr & gallagher 5,715 1
15 Eversheds 2,853 2
Source: mergermarket
VoLUME
The legal adviser league tables by value and volume have been run from 1 January 2010 to 31 July 2010 and include lapsed and withdrawn deals. The tables cover all sectors and are based on the geography of either the target, bidder or seller being Middle East (including Israel) & African-based.
YTD 31-Jul-10
house Value (US$m)
Deal count
1 Webber Wentzel 7,488 11
2 Linklaters 16,419 8
3 Werksmans 866 8
4 Edward nathan Sonnenbergs 6,815 7
5 Bowman gilfillan 1,702 7
6 Allen & overy 13,573 6
7 Herbert Smith/gleiss Lutz/Stibbe 15,435 5
8 AZB & partners 11,490 5
9 Freshfields Bruckhaus Deringer 6,396 5
10 DLA Cliffe Dekker Hofmeyer 785 5
11 Dewey & LeBoeuf 2,163 4
12 gibson Dunn & Crutcher 735 4
13 Jones Day 597 4
14 norton Rose - 4
15 Sullivan & Cromwell 6,365 3Source: mergermarket
TOP 15 LEgAL ADVISERS – MIDDLE EAST & AFRICA
52
Mid
dle east &
africa
Monthly M&A Insider
LEAgUE TABLES
VALUE
VALUE
YTD 31-Jul-10
house Value (US$m)
Deal count
1 Capitau 453 1
2 Actis Capital 30 1
3 Tene Capital 23 1
4 Capinnova Investment Bank 20 1
5= good Energies 15 1
5= new Energies Invest 15 1
5= Zouk Ventures 15 1Source: mergermarket
VoLUME
The private equity buyout activity tables by value and volume are based on private equity firms advising the bidder on buyout deals where the dominant geography of the target company is Middle East (including Israel) & African-based. The tables by value and volume have been run from 1 January 2010 to 31 July 2010 and exclude lapsed and withdrawn deals.
YTD 31-Jul-10
house Value (US$m)
Deal count
1 Capitau 453 1
2 Actis Capital 30 1
3 Tene Capital 23 1
4 Capinnova Investment Bank 20 1
5= good Energies 15 1
5= new Energies Invest 15 1
5= Zouk Ventures 15 1Source: mergermarket
TOP 5 PRIVATE EqUITY FIRMS BY MIDDLE EASTERN & AFRICAN BUYOUTS
VALUEYTD 31-Jul-10
house Value (US$m)
Deal count
1 pamodzi Investment Holdings 453 1
2 Radius Ventures 160 1
3 pitango Venture Capital 100 2
4 Cedar Fund 89 2
5= Ant Capital partners 60 1
5= Bridge Capital Fund 60 1
5= Marathon Venture Capital Fund 60 1
5= Mitsubishi UFJ Capital 60 1
5= nippon Venture Capital 60 1
5= Teuza - A Fairchild Technology Venture 60 1
5= yozma group 60 1Source: mergermarket
VoLUME
The private equity exit activity tables by value and volume are based on private equity firms advising the vendor on exit deals where the dominant geography of the target company is Middle East (including Israel) & African-based. The tables by value and volume have been run from 1 January 2010 to 31 July 2010 and exclude lapsed and withdrawn deals.
YTD 31-Jul-10
house Value (US$m)
Deal count
1 pitango Venture Capital 100 2
2 Cedar Fund 89 2
3 Evergreen Venture partners 29 2
4 pamodzi Investment Holdings 453 1
5 Radius Ventures 160 1Source: mergermarket
TOP 5 PRIVATE EqUITY FIRMS BY MIDDLE EAST & AFRICA ExITS
53
Mid
dle east &
africa
Monthly M&A Insider
TREnD gRApHS
MIDDLE EAST & AFRICA M&A qUARTERLY TREND
VALUE VoLUME
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
Q310*
Q210
Q110
Q409
Q309
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q207
Q107
Q406
Q306
Q206
Q106
Q405
Q305
Q205
Q105
Q4 4
Q304
Q204
Q104
Valu
e (U
S$m
)
0
30
60
90
120
150
Q310*
Q210
Q110
Q409
Q309
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q207
Q107
Q406
Q306
Q206
Q1 06
Q405
Q305
Q205
Q105
Q404
Q304
Q204
Q104
Volu
me
of d
eals
MIDDLE EAST & AFRICA M&A qUARTERLY MID-MARkET TREND
VALUE VoLUME
0
1,000
2,000
3,000
4,000
5,000
6,000
Q310*
Q210
Q110
Q409
Q309
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q207
Q107
Q406
Q306
Q206
Q106
Q405
Q305
Q205
Q105
Q404
Q304
Q204
Q104
Valu
e (U
S$m
)
0
10
20
30
40
50
60
70
80
Q310*
Q2 10
Q110
Q409
Q309
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q207
Q107
Q406
Q306
Q206
Q106
Q405
Q305
Q205
Q105
Q404
Q304
Q204
Q104
Volu
me
of d
eals
Moving average trend line
54
Mid
dle east &
africa
Monthly M&A Insider
TREnD gRApHS
MIDDLE EAST & AFRICA M&A SECTOR BREAkDOwN YTD 2010
VALUE VoLUME
2.8%0.2%
0.4%0.1%
3.9%
16.8%
12.1%
34.8%
9.4%
3.5%
5.9%
1.1%
9.0%
Industrials & Chemicals
Energy, Mining & Utilites
Financial Services
TMT
Consumer
Business Services
Real Estate
Pharma, Medical & Biotech
Leisure
Transportation
Construction
Agriculture
Defence
15.7%
14.5%
15.7%
9.0%
0.6%1.8%2.4%
2.4%2.4%
3.8%
6.0%
12.7%
13.3%
Industrials & Chemicals
Energy, Mining & Utilites
Financial Services
TMT
Consumer
Business Services
Real Estate
Pharma, Medical & Biotech
Leisure
Transportation
Construction
Agriculture
Defence
MIDDLE EAST & AFRICA M&A qUARTERLY PRIVATE EqUITY TREND
VALUE VoLUME
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
-
Q310*
Q210
Q110
Q409
Q309
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q207
Q107
Q406
Q306
Q206
Q106
Q405
Q305
Q205
Q105
Q404
Q304
Q204
Valu
e (U
S$m
)
Middle East& Africa buyouts
Middle East& Africa exits
0
2
4
6
8
10
12
14
16
18
20
-
Q310*
Q210
Q110
Q409
Q309
Q209
Q109
Q408
Q308
Q208
Q108
Q407
Q307
Q207
Q107
Q406
Q306
Q206
Q106
Q405
Q305
Q205
Q105
Q404
Q304
Q204
Num
ber
of d
eals
Middle East& Africa buyouts
Middle East& Africa exits
55
Mid
dle east &
africa
Monthly M&A Insider
TREnD gRApHS
MIDDLE EAST & AFRICA M&A gEOgRAPhIC BREAkDOwN YTD 2010
VALUE VoLUME
1.6%
0.8%
7.3%
4.4%
1.7% 33.5%
4.0%
2.9%
3.7%
0.9%
5.3%0.7%
32.3%
South Africa
Israel
Egypt
United Arab Emirates
Kuwait
Qatar
Saudi Arabia
Nigeria
Oman
Namibia
Angola
Lebanon
Zambia
31.1%
27.0%
8.8%
6.1%
4.7%
3.4%
3.4%
2.7%
2.7%
2.0%
2.0%
2.0%
1.4%
1.4%1.4%
South Africa
Israel
Egypt
United Arab Emirates
Kuwait
Qatar
Saudi Arabia
Nigeria
Oman
Namibia
Jordan
Syrian Arab Republic
Angola
Lebanon
Sierra Leone
MIDDLE EAST & AFRICA M&A DEAL SIZE BREAkDOwN
VALUE VoLUME
0
10
20
30
40
50
60
H22010*
H12010
H22009
H12009
H22008
H12008
H22007
H12007
H22006
H12006
H22005
H12005
H22004
H12004
> US$501m
US$251m-US$500m
US$101m-US$250m
US$15m-US$100m
US$5m-US$14.9m
Valu
e ($
bn)
0
50
100
150
200
250
H22010*
H12010
H22009
H12009
H22008
H12008
H22007
H12007
H22006
H12006
H22005
H12005
H22004
H12004
> US$501m
US$251m-US$500m
US$101m-US$250m
US$15m-US$100m
US$5m-US$14.9m
Value not disclosed
Num
ber
of d
eals
www.mergermarket.comRemark, part of The Mergermarket group
80 StrandLondon, WC2R 0RLUnited Kingdom
t: +44 (0)20 7059 6100f: +44 (0)20 7059 [email protected]
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This publication contains general information and is not intended to be comprehensive nor to provide financial, investment, legal, tax or other professional advice or services. This publication is not a substitute for such professional advice or services, and it should not be acted on or relied upon or used as a basis for any investment or other decision or action that may affect you or your business. Before taking any such decision you should consult a suitably qualified professional adviser. Whilst reasonable effort has been made to ensure the accuracy of the information contained in this publication, this cannot be guaranteed and neither Mergermarket nor any of its subsidiaries nor any affiliate thereof or other related entity shall have any liability to any person or entity which relies on the information contained in this publication, including incidental or consequential damages arising from errors or omissions. Any such reliance is solely at the user’s risk.
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The following notes pertain to data contained in this publication:
• Deals are included where the deal value is greater than or equal to €5m.
• Where no deal value has been disclosed, deals are included if the turnover of the target is greater than or equal to €10m.
• Deals are included in the graphs and Top Deals in each section based on the dominant geography and dominant sector of the target company. Data underlying the League Tables are based on deals where the bidder, target or parent geography of either is that of the geography in focus.
• H1 2010 refers to the period 31 January 2010 to 31 July 2010.