Worldwide M&A activity predicted to hit new high in 2018, but imbalances grow
Announcements projected to grow 7% in second half of year and 3% for FY 2018
NEW YORK, August 9 ,2018 – Intralinks®, the world's leading virtual data room (VDR) provider, announced today that that the number of worldwide announced mergers and acquisitions (M&A) deals is expected to increase by 7% year-over-year (YOY) in H2 2018 and by 3% for the full year 2018 based on the latest Intralinks Deal Flow Predictor, an indicator of future mergers and acquisitions (M&A) announcements with a proven track record for accuracy.
This would mark 2018 as a new annual high for the number of announced transactions. The strongest growth in worldwide deal announcements is expected to come from the Real Estate, Technology, Media and Telecoms (TMT) and Industrials sectors. However, growth in worldwide M&A announcements so far this year has been extremely unbalanced, with the Asia Pacific region dominating both the increase in the actual numbers of announced deals so far and those forecast for the remainder of the year. APAC has been the only region to show any growth in the number of announced deals, with its 12% YOY growth offsetting a 6% decline in the rest of the world.
“The M&A market seems set to end 2018 on a new high,” said Philip Whitchelo, Intralinks’ vice president for Strategic Business Development. “The short-term outlook for M&A remains positive and the M&A market has many reasons to continue to grow, including a strong global economy, low inflation, low interest rates and record amounts of private equity dry powder competing with deal-hungry corporate acquirers. However, we continue to believe that the M&A market may be nearing a cyclical peak.”
The Intralinks Deal Flow Predictor forecasts the number of future M&A announcements by tracking early-stage M&A activity – new sell-side M&A transactions that are in preparation or have begun their due diligence stage. These deals are, on average, six months away from their public announcement.
In Asia Pacific, the number of announced M&A deals is predicted to increase by around 19%, within a range of 12% to 27%, led by the Energy and Power, TMT and Materials sectors. Within APAC, all regions are showing double-digit increases in their volumes of early-stage M&A activity.
In Europe, the Middle East and Africa the number of announced M&A deals is predicted to remain flat YOY, within a range of -5% to 5%. France, Italy and the UK are predicted to show the highest increases in M&A announcements in Europe over the next six months.
In Latin America, the number of announced M&A deals is predicted to decrease increase by around 20% YOY, within a range of -32% to -7%. The real estate sector is predicted to be the only one to see growth in LATAM M&A announcements over the next six months. Among the largest LATAM economies, Argentina and Chile are predicted to show the highest increases in M&A announcements over the next 6 months.
In North America, the number of announced M&A deals is predicted to increase by around 4% YOY, within a range of -4% to 13%, led by the Real Estate, TMT and Energy and Power sectors. This growth is being driven by the U.S., with Canada expected to see declining levels of M&A announcements.
Intralinks is a leading financial technology provider for the global banking, deal making and capital markets communities. As pioneers of the virtual data room, Intralinks enables and secures the flow of information facilitating strategic initiatives such as mergers and acquisitions, capital raising and investor reporting. In its 22-year history Intralinks has earned the trust and business of more than 99 percent of the Fortune 1000 and has executed over US$34.7 trillion worth of financial transactions on its platform. For more information, visit www.intralinks.com.
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