20 January, 2016
Headlines
Deals between EU and North America account for 35% of all cross-regional activity by volume and 38% of activity by value Asia-Pacific businesses prove to be active acquirers, pursuing deals totalling $31.1bn in the financial services sector alone However, cross-border M&A into the Asia-Pacific region dropped 20% in volume and 16% in value in the first nine months of 2015 compared to the same period in 2014
In the third quarter of 2015, cross-regional M&A activity totalled $309.8bn, with 711 deals – more than one-third of which involved transactions between companies based in the EU and North America. Dealmaking between these two regions stood at 252 transactions worth $119.2bn, representing a 10% decline in volume but a 34% increase in value from the previous quarter.
North American bidders pursued 154 EU-based targets, for a total of $40.6bn, primarily in the UK (67 deals), Germany (20) and the Netherlands (16). The industrials sector led the way in volume, with 32 deals worth $5.3bn, while the chemicals and materials sector led in value, with seven deals worth a total of $8.8bn.
Deals with an EU bidder and North America target trailed in number compared to those with a North American bidder and EU target, with 98 transactions, but were worth nearly twice as much at $78.6bn. The business services sector had the largest number of transactions (17 deals worth $2.4bn) while the consumer sector ranked first for total value (11 deals worth $17.6bn).
Asia-Pacific companies were active acquirers during the third quarter, with a total of 153 acquisitions worth $63.5bn driven by companies based in Japan (43 deals), China (38) and India (17). Outbound activity from Asia-Pacific focused largely on the financial services sector, with 13 deals worth a combined $31.1bn representing nearly half of all activity by value.
Nearly half of outbound deal volume from Asia-Pacific targeted EU-based companies, with a total value of $26.7bn, while more than one-third of volume targeted North America with a total value of $28.5bn. In addition, Asian acquirers demonstrated an appetite for Latin American assets, with 11 deals in Q3, and 30 so far this year—up from 22 in all of 2014.
Asia-Pacific was also a popular target, with 92 deals totalling $25.4bn in the third quarter. North American bidders accounted for 55% of the number of inbound transactions, while EU bidders comprised 38%. In the last year, however, China's economic slowdown has begun to impact transactional activity throughout the region. In the first nine months of this year, inbound deal activity in Asia-Pacific fell 20% in volume and 16% in value compared to the same period in 2014.
For further information, please contact:
Milton W. M. Cheng, Managing Partner Hong Kong/China/Vietnam/Korea, Baker & McKenzie
milton.cheng@bakermckenzie.com
