In the first half of 2018, there were 8,560 deals valued at US$1.9 trillion—an increase of 25.9% by value, and 1,069 fewer deals than in HY 2017. There was no shortage of massive deals across the globe, with stark contrast between total global deal value and amount of transactions. But among these substantial deals, no one region stood out from the rest; each of the six regions saw significant deals. However, every nation in the Asia-Pacific region (besides Japan) experienced an increase in terms of both deal count and value. Globally, the total number of PE buyouts in the first half of the year declined YoY. Yet while PE firms made fewer deals, these deals were substantial.
Regional 1H 2018 Global Mergers and Acquisitions
North America M&A Deals
Home to two of the world’s most advanced economies, North America saw 2,862 deals that amounted to US$877.1 billion in the first half of 2018, totaling 45.2% of market share. Both the U.S. and Canada experienced a significant rise in deals, with much of the increase due to transformative mergers, major divestments, and massive PE buyouts. Cumulatively, deal value grew 27% year-over-year in the first half to US$854 billion, the largest increase since the first half of 2015 when the global M&A value record was reached. However, cross-border activity plunged year-over-year in the first half of 2018, with inbound deal value dropping 41.5%, and outbound value dipping by 11%.
Central and South America M&A Deals
While Central and South America experienced a total deal value of US$45.6 billion, Brazil and Chile were by far the main drivers of these numbers; the two nations contributed US$37 billion, or about 81%. Concerning year-over-year growth, there was a 62.3% increase in total M&A value, offsetting the reduction in PE buyout value. While Brazil contributed US$27.3 billion, just under half of that figure came from one massive transaction with Suzano Paper e Celulose’s acquisition of Fibria Celulose. When looking at these numbers by sector, Industrials & Chemicals reached the highest value, coming in at US$21 billion. PE buyouts, however, dropped in year-over-year value from US$1.98 billion to US$1.11 billion.
Europe M&A Deals
In the first half of 2018, Europe saw 3,199 deals worth US$600.9 billion—the largest number of deals in over a decade. The UK topped other regional countries with 629 deals totaling US$147.4 billion, making up nearly a quarter of the region’s market share. Germany and Ireland followed with 408 deals totaling US$95.5 billion and 73 deals amounting to US$84.3 billion, respectively. Regionally, Pharmaceuticals, Medical, & Biotech eclipsed other industries with 222 deals valued at US$121.8 billion, with the Energy, Mining, & Utilities sector following at second with 167 deals valued at $109.3 billion. There were 635 PE-backed deals totaling US$80.7 billion, up 10.9% in value when compared to the first half of 2017.
Middle East & Africa M&A Deals
MEA was off to a sluggish start in 2018; the first half of 2017 saw the region reach 247 deals valued at US$39.3 billion, while the same period in 2018 saw the region’s deals dip to 165 and valued at US$28.4 billion. A slow Q2—with 66 deals valued at US$10.5 billion—contributed to a decrease in the first half, and was the lower deal value since 2016. Despite a slow Q2, the region saw quite a few large outbound deals into Europe, with the largest totaling US$4.4 billion, and two other sizable deals at US$3.2 billion and US$2.5 billion. Israel lead the region with 40 deals totaling US$12.5 billion, and the UAE reaching US$7.8 billion from 28 deals. The Energy, Mining, & Utilities industries topped sector value at US$11.4 billion with 36 deals, and Industrials & Chemicals trailing in second at US$7.5 billion.
Asia-Pacific (Excluding Japan) M&A Deals
The region recorded several major deals in the first half of 2018, with 1,850 deals totaling US$370 billion—a 33.1% increase in value and 90 more deals than in the first half of 2017. China lead the way with 855 deals totaling US$203.2 billion, while India experienced the second-highest activity with 201 deals valued at US$66 billion. Three megadeals in the region totaled US$40.7 billion and contributed 11% in the first half of 2018 deal value. Cross-border activity was strong in Q2, with 271 registered inbound deals valued at US$53.2, and outbound deals totaling US$82.9 billion—a 52.1% increase in the first half of 2017. By sector, Industrials & Chemicals outpaced other industries with 389 transactions, totaling 21% of the region’s overall deal count. Technology eclipsed Industrials & Chemicals in terms of deal value with 263 transactions worth US$66.8 billion—growing 97.1% when compared to 2017.
Japan M&A Deals
The first half of 2018 saw Japan with a 229.1% increase in outbound deals, totaling US$111.4 billion. Inbound deals were down 76.7% at US$1.3 billion, while domestic deals saw a 76.3% increase at US$15.7 billion. The Consumer sector surpassed other sectors with 38 deals totaling US$4.4 billion—four times greater than at this time one year prior. PE buyouts, however, saw the lowest quarterly value in two years from seven deals totaling US$137 billion. With 22 buyouts so far in 2018, the deal count is poised to remain roughly the same as one year prior. However, PE buyout value has decreased by 78.8%.
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