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May 16, 2016 download PDF
The M&A market was mixed in April 2016, with the U.S. market generally faring better than the global market. In the U.S., overall deal volume increased by 71.1% to $115.57 billion, which is the highest monthly deal volume for the U.S. in 2016. The increase in total U.S. deal volume for April 2016 is largely attributable to U.S. strategic activity, which increased by 95.4% to $96.38 billion in volume, as compared to March 2016. U.S. sponsor-related activity, on the other hand, was relatively flat with an increase of 5.4% to $19.19 billion in volume. The total number of U.S. M&A transactions decreased by 6.3% to 711, while average U.S. deal value increased by 86.2% to $424.9 million.
Conversely, global M&A activity declined slightly in April 2016, with overall deal volume decreasing by 0.4% to $235.11 billion, and global strategic deal volume decreasing by 2.5% to $187.92 billion. Global sponsor-related deal volume, however, was up by 9.2% to $47.18 billion. The total number of transactions globally decreased by 10.7% to 2,821, while average global deal value increased by 17% to $159.6 million. Figure 1.
Crossborder activity was also mixed in April 2016. Inbound U.S. deal volume increased by 33.9% to $32.02 billion, while the number of inbound transactions decreased by 7.2% to 129. Outbound U.S. deal volume decreased by 68.2% to $4.76 billion in April 2016, while the number of outbound transactions increased by 10.4% to 117. Globally, crossborder deal volume decreased by 19.3% to $69.16 billion, and the number of transactions decreased by 9.3% to 684. Figure 1. France was the leading country, by deal volume, for U.S. inbound transactions in April 2016 ($9.96 billion), while Canada maintained its monthly lead for the highest number of U.S. inbound transactions (32). Canada continues to hold its lead for U.S. inbound activity, as measured by both deal volume ($104.03 billion) and number of transactions (429) over the last 12 months. As for outbound transactions in April 2016, Australia led by deal volume ($1.32 billion), while Canada maintained its top position for the number of transactions (25). Figure 3.
Healthcare was the most active target industry by deal volume in the U.S. in April 2016 ($58.65 billion) and over the last 12 months ($390.88 billion). Computers & Electronics maintained its lead for number of transactions in the U.S., both in April 2016 (168) and as measured over the last 12 months (2,803). Figure 2.
The form of consideration for M&A transactions in April 2016 fell more in line with its trend over the last 12 months, with 50% of transactions having cash as the sole form of consideration. Figure 9. Transactions involving tender offers as a percentage of U.S. public mergers increased to 28.6% in April 2016, which is well above the average over the last 12 months (17.7%). Figure 11. Finally, we note that the incidence of hostile offers as a percentage of U.S. public mergers decreased to 16.7% of U.S public mergers from a high of 27.3% in March 2016. Figure 12.
Click here to watch the Video Summary: M&A at a Glance (May 2016)