North American M&A falls to new 12-month low in July

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There were a total of 1,303 mergers and acquisitions (M&A) worth a combined USD 82,105 million targeting North American companies announced in July 2017, according to information collected by the Bureau van Dijk M&A database Zephyr.

Lisa Wright, Zephyr director

The absence of high-value deals worth more than USD 10,000 million has brought down the value of North American M&A activity in July...

There were a total of 1,303 mergers and acquisitions (M&A) worth a combined USD 82,105 million targeting North American companies announced in July 2017, according to information collected by the leading M&A database Zephyr. Value for the period fell from USD 110,109 million in June against a decline in volume from 2,179 deals. Year-on-year, volume was down by a third from 1,934, while value fell 39 per cent from USD 134,855 million in July 2016.

Zephyr shows that US companies dominated the top 20 deals by value once again, with Berkshire Hathaway Energy’s acquisition of Energy Future Holdings for USD 9,000 million accounting for the month’s largest M&A deal by value. It is worth noting Canadian companies signed off on three high-value deals, the largest of which was a secondary offering of an 8 per cent stake in Canadian Natural Resources by Shell worth roughly USD 3,157 million.

The pending acquisitions of Energy Future and Avista, and a capital increase by Hydro One, pushed up the value of deals within the gas, water and electricity sector to USD 16,077 million in July (June: USD 2,208 million), which accounted for a fifth of North America’s total value of USD 82,105 million.

Lisa Wright, Zephyr director, commented, “The absence of high-value deals worth more than USD 10,000 million has brought down the value of North American M&A activity in July but Canadian dealmaking is the bright spot in an otherwise slow month for the M&A and PE/VC landscape.”

The Zephyr database shows that the value of PE and VC investment targeting companies based in North America declined in July to 810 deals worth a combined USD 17,908 million from 1,291 valued at USD 31,455 million in June, and was also down year-on-year from 1,100 deals worth USD 31,477 million in July 2016.

A significant decline in the value of deals with US targets attributed to the overall decline in PE and VC value: in all US companies announced 771 deals worth a total USD 17,206 million, compared to 1,237 valued at USD 31,116 million in June. However, the value of PE and VC investment in Canadian companies more than doubled over the four weeks to USD 694 million from USD 338 million.

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Toya Thompson
Bureau van Dijk
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