DealCloserBlog Roundup January 16
Welcome to your guide on the latest M&A, corporate development, and alternative investments news. This week features 2014 M&A activity and a 2015 outlook.
16 January 2015
Welcome to your guide on the most interesting M&A, corporate development, alternative investments and debt capital markets news and events.
Because you can’t follow all of the dealmaking updates, we do it for you. Each week we will share the top stories featured on our blog to catch you up to speed. Check these out …
- Now that 2014 is closed officially, we can develop some perspective on the magnitude of its M&A. It was indeed a rebound year for deals, both in terms of volume and valuation. There was around $3 trillion's worth of M&A, as an NPR article notes.
- As good as 2014 M&A activity was, 2015 may yet be better, says Forbes. The strong market drivers in 2014 were cheap cash, the need for growth, deep corporate coffers, etc. These factors will most likely push the mid-market in 2015. In fact, private equity is sitting on some $750 billion in “dry powder” to use in deals, Forbes notes. We’ve even seen our first big deal announcement: Shire’s $5.2 billion buyout of NPS Pharmaceuticals Inc. To stay ahead of the M&A market, check out our Intralinks Deal Flow Predictor, a unique indicator of future activity at least six months in advance of announced deals.
- The M&A optimism appears to be spreading. And middle-market dealmakers are particularly bullish on this year’s technology, media and telecommunications sector, notes Mergers & Acquisitions. Overall, this segment did very well last year. The M&A drivers in this area included cloud, mobile, analytics and e-commerce.
- Speaking of strong M&A sectors: Healthcare in general has been on a deal rebound. Bloomberg points out that biotech M&A are off to a strong start for 2015. Shire’s not alone in making deals (see above) Biogen Idec made a $675 million successful offer for Convergence Pharmaceuticals, a U.K.-based experimental pain medicine company. The pharmaceutical industry saw a “boom” in mergers in 2014, which is natural. These companies have to replace products going off-patent and to stoke inorganic growth. And given the record number of IPOs in biotech last year, there is an especially broad field of targets for big pharma to pick from.
- On a positive note, dealmakers are expecting to see more M&A activity in 2015, says CFO magazine. Citing a recent Mergers & Acquisitions magazine and KPMG survey, the article claims that 82 percent of respondents expect their firms or clients to attempt at least one acquisition next year. (Last year, only 63 percent of respondents made that prediction.) Generally, valuations for deals will rise, too, with dealmakers aiming for transactions running from $250 million to $1 billion in value.
- And finally, has the company you want to sell become a distressed asset? If so, you should create an appropriate action plan to make the most of the situation, says Yoav M. Cohen, managing partner and CEO of NYC Advisors LLC. His blog offers an example of a successful emergency exit. Read how a rapid, aggressive action plan led to a successful sale, despite the challenges.
Thanks for reading. Stay tuned to our blog each week for more highlights.
Marc Songini has worked in the information technology field for more than 16 years. His roles have included those of journalist, analyst, and marketing communications specialist. He admits that when he started out as a cub high tech reporter, Netscape was still rocking the industry with a wondrous new user interface called a “browser.” During his 10 years with International Data Group (IDG), Marc wrote for NetworkWorld and Computerworld, both award-winning magazines. Marc specializes in cloud, enterprise apps, and figuring out the meaning of being human in an automated world.