M&A at a Glance (November 2013)

As may be expected coming off a month with the mega-sized Vodafone transaction, we saw a decline in the volume of global and U.S. M&A deals this month.  In contrast to a trend starting in January 2013, the number of deals increased overall in October 2013, although there were minor declines in the number of global sponsor-related deals and U.S. outbound crossborder transactions.  Figure 1.  Japan was the leader in inbound U.S. transactions, while Germany was the leader for outbound U.S. transactions, and Belgium made its debut on our charts for inbound U.S. crossborder transactions by volume.  Over the last 12 months, however, Canada dominated the U.S. crossborder scene by volume and number of deals.  Figure 3.  The average value of U.S. public mergers continued to climb slowly, but the average value of the five largest transactions in October remained relatively low.  Figure 4.  This month's average reverse break fee of 3.1% was the lowest since November 2012, but that was likely due to the presence of one deal with a low reverse break fee of less than 2%.  Figure 7. October also showed a large increase in transactions using a combination of cash and stock as consideration.  Figure 9. September saw an uptick in tender offers, but lower levels of tender offers returned in October.  We note that the addition of new Section 251(h) to the Delaware General Corporation Law, which allows second-step mergers to be consummated without stockholder approval following a tender offer, does not appear to have opened the floodgates for tender offers as of yet.  Figure 11.  Finally, hostile/unsolicited offers were up to one-quarter of U.S. public mergers, the largest ratio since April of this year. Figure 12.