Tag archives: Deloitte

The growth and expansion of streaming services

The source of our television services is significantly changing from traditional cable and television services to online providers. The actively changing television service landscape is because of the growth of over-the-top (“OTT”) media services.

Growing Popularity

According to a report by the Canadian Radio-Television and Telecommunications Commission, OTT services are television services that are provided through the internet. The CRTC Report identifies most of these OTT services as subscription-based-video-on-demand services, such as Netflix and Crave. The CRTC attributes SVOD services as generating the bulk of OTT revenue, surpassing traditional broadcasting revenue by almost a billion dollars.

Streaming Wars

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“DARQ” technology and disruptive M&A: gearing up for the “post-digital era”

As technology has become embedded into most parts of our lives, the majority of companies have completed a digitization process. Maintaining a digital platform has become the new norm, and increasingly sophisticated technologies continue to be developed. Accenture’s Technology Vision 2019 (Vision Report), describes this as the transition to the “post-digital era,” where “digital” is a new normal and is no longer a sign, on its own, of innovation. The Vision Report highlights main technology trends that companies will need to get ahead of in order to become leaders.

The main questions related to this “post-digital shift” are; … Continue Reading

Spreading like weeds: alternative cannabis products are on the way!

As we have previously discussed, Canada has positioned itself as a global leader in the cannabis space. That trend is set to continue on October 17, 2019, when it is expected that alternative cannabis products, which include edibles, infused beverages and topicals containing cannabis and cannabis concentrates will be legalized in Canada. The sale of a new and wider range of products will create valuable opportunities to tap into a growing market of consumers – particularly, those less comfortable with traditional cannabis consumption methods. According to a recent report published by Deloitte, it estimated that the Canadian market for … Continue Reading

Cannabis and corporate governance: time for grow ops to grow up?

Since the legalization of recreational cannabis on October 17, 2018, the Canadian cannabis industry has experienced a significant boom. In its 2018 Cannabis Report, Deloitte predicted that legal sales of marijuana are expected to generate up to $4.34 billion in 2019. Moreover, and as previously discussed, Health Canada has introduced draft regulations governing the production and sale of edibles, extracts, and topicals, potentially providing additional growth opportunities for Cannabis companies to partner with the traditional food and beverage industry.

As the industry continues to grow, it is worth asking the question, how do these companies stack up from … Continue Reading

3D printing – the manufacturing industry’s “comeback kid”

Speed. Scale. Diversity.

What do these words have in common? According to Deloitte, they are the three main reasons that 3D printing, also known as additive manufacturing (AM), is experiencing a sustained resurgence in 2019.

Deloitte recently published the 18th edition of its Technology, Media & Telecommunications Predictions report, which forecasts both global and regional trends in its titular sectors for 2019. In the past, Deloitte reports explored 3D printing, expressing cautious optimism in the face of the market’s supposed overenthusiasm for the new technology and its seemingly endless possibilities. Though the 3D printing market never collapsed, … Continue Reading

U.S. M&A: full speed ahead for 2019

Optimism is the name of the game for the U.S. M&A market. A recent report by Deloitte cites positive tax reform, a relaxed regulatory climate and growing cash reserves as the primary reasons for expecting 2019 to be a big year for M&A. 79% of the 1,000 U.S. corporate executives and private equity firms surveyed said their organizations will close more deals in 2019 than 2018. 70% of the respondents also expect the aggregate value of deals closed to exceed 2018, with over half of deals expected to be between $500 million and $10 billion.

Interestingly, divestitures are expected to … Continue Reading

Beware the zombie invasion (stock exchange edition)

On September 18, Deloitte released a new report which outlines a roadmap for the competitive business climate in Canada. Included in the report is a warning that “Canada may have a zombie problem.” Luckily, Deloitte isn’t raising concern about hordes of flesh-eating undead, but rather the relatively large number of “zombie companies” that exist on Canadian stock exchanges. The report identifies “zombie companies” as those who do not have enough earnings to cover their interest payments and found that out of the 2,274 companies listed on the Toronto Stock Exchange and the TSX Venture Exchange, 16% could be considered “zombies” … Continue Reading

Digitalization – the pill for M&A failures?

It is a generally accepted fact that a significant number of M&A deals fail to deliver value post-closing. In a recent survey (the Survey) discussed in the Deloitte 2018 M&A trends report (the Report), 55% of respondents agreed that up to 25% of their M&A deals fall short of meeting or beating expectations. We’ve discussed the factors that can contribute to this failure on a previous blog post and in a recent article, including: cultural and business integration issues, poor due diligence, negotiation errors, lack of involvement by owners, and an overall lack of clarity. Moreover, a … Continue Reading

Top M&A attractions in 2018: technology assets and international markets

According to Deloitte’s latest M&A trends report, corporations and private equity (PE) firms expect to see an acceleration of M&A activity in 2018, both in volume and size of deals, and with particular interest in technology assets and international markets.

Key Findings

After surveying more than 1,000 executives at corporations and PE firms on their views and expectations for 2018, Deloitte provides some insightful findings.

Technology acquisitions now rank #1 as a strategic driver for M&A deals

20% of those surveyed cite the acquisition of technology assets as the principal reason behind deals, which surpasses deals to … Continue Reading

Due diligence and risk mitigation in cross-border deals

As discussed in an earlier post, cross-border M&A deals are on the rise. Most businesses today are looking to unlock value from technology, emerging markets are flourishing and pursuing global investment opportunities and barriers to information have diminished. These are all factors giving rise to cross-border deals.

Transaction risk in cross-border deals

Cross-border deals come with many advantages, including the ability to expedite time to market, to scale and enhance brand recognition and to mitigate competition. However, cross-border deals are also accompanied by their unique set of disadvantages, making it all the more important to manage transactional risks.

Parties’ … Continue Reading

Like fine wine, does M&A activity get better with age?

Canada’s population is aging quite rapidly. Statistics Canada reported that in 2016, the proportion of seniors representing the total Canadian population surpassed that of children. Furthermore, since 2011, there has been a rapid increase in the number of Canadians over 65 years of age and leaving the workforce. As explored in a previous blog post, such demographic changes and trends are rather intimately related to merger and acquisition (M&A) activity. In particular, as more and more Canadians reach ages 65 and older, a greater proportion of retiring business owners will consider selling their businesses.

Demographic changes fuel

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Blockchain technology: an imminent driver of investment and M&A

Blockchain technology has been making headlines since it emerged in 2009 in connection with the cryptocurrency Bitcoin. We’ve covered the potential use of Bitcoin in M&A transactions in previous articles in 2016 and 2014. As discussed in these articles, the volatility and lack of central authority has so far meant that the cryptocurrency plays a niche role in the capital markets.

However, blockchains – the technology behind Bitcoin – has been gaining ground for its exciting enterprise potential. We are already beginning to see companies racing to adopt this emerging technology, as more and more companies acquire the technology … Continue Reading

Canada punches above its weight-class in cross-border deals and works on attracting greenfield and other private investment

Over the past few months, the Canadian government has been working to establish a source of financing for several infrastructure projects across the country. These projects include public transit initiatives, green infrastructure, social infrastructure, and smaller tailored projects for our rural and northern communities. What makes this interesting is how Canada is sourcing the money.

Infrastructure bank to be established

The government is in the process of establishing an infrastructure bank, wherein $35 billion in public funds will be used to get the projects off the ground. The hope is that the private sector will respond with around $140 billion. … Continue Reading

M&A trends for 2017: Canada a likely target

According to a year-end report on M&A Trends published by Deloitte, corporate and private equity executives surveyed in the last quarter of 2016 anticipated significant M&A activity in 2017. Indeed, three quarters of survey respondents expect deal activity to increase in 2017 relative to 2016, and almost 65% expect deal size to increase. Aside from strategic reasons, the expected increase in the pace and size of transactions may be linked to high stock prices, continued low interest rates, and availability of cash held in reserve by large companies.

In the Canadian context, the Deloitte report suggests that U.S.-based investors … Continue Reading

Optimistic M&A outlook for 2017

As we begin 2017, the 1,000 corporate and private equity executives surveyed for Deloitte’s M&A Trends Year-end report 2016 display optimism for the coming year. The survey was conducted in September 2016 and included participants from companies or private equity firms with annual revenues of $10 million or more, representing 18 industries.

Respondents expect a rebound year from 2016, with 86% of surveyed private equity and 71% of surveyed corporate dealmakers expecting to close more deals this year. Not only is deal volume expected to increase, but 64% of all respondents also expect deal size to increase. Divestitures appear poised … Continue Reading

Artificial intelligence M&A: the new gold rush

While many people are still in shock after discovering that there is actually no human controlling the steering wheel in autonomous cars, tech companies, including Google, IBM, Yahoo, Intel and Apple, have found themselves in the middle of a gold rush for artificial intelligence (AI) companies. According to recent research by CB Insights, around 140 AI companies have been acquired since 2011, and the number of AI startup M&As has increased more than seven fold between 2011 and 2016. In fact, the race to invest in AI has been characterized as “the latest Silicon Valley arms Continue Reading

Merging of digital and physical worlds: impact on M&A in non-digital industries

Strategy& of PwC published Mergercast “Digital Deals – A New Frontier” (Episode 56) in July 2016, which discusses the growing rationale for digital deal-making and post-deal challenges. Particularly, this podcast identifies that digital deals accounted for nearly 32% of all transactions in 2015, up by 20% since 2011, indicating the growing appetite for digital M&A. Many companies operating in traditional industries are looking to enter into or enhance their digital capabilities by identifying digital targets, particularly hardware, software, IT service and Internet companies. Digital deal growth is most notable in non-digital industries, such as automotive, retail and wholesale, aerospace, defense, … Continue Reading

M&A activity in Canada’s upstream oil and gas sector remains slow in 2016

Many in the oil and gas industry expected to see increased levels of M&A activity in the upstream oil and gas sector, and in the broader oil and gas industry, as a result of prolonged depressed oil prices that first began their decline in June of 2014. We have discussed various views regarding this topic on this blog previously both here and here. In previous downturns, depressed prices have led to increased deal activity as distressed exploration and production companies (“E&P companies”) are forced to sell assets to improve cash flow, assets are sold in the course of bankruptcy … Continue Reading

Discipline: a key deal factor for mid-market companies

Earlier this year, we reviewed Deloitte and Touche LLP’s (Deloitte) 2016 survey of M&A trends (the Survey), which predicted that the year would match or exceed deal volume as compared to 2015. Deloitte recently published an article (the Article) which delves deeper into its Survey results from mid-sized companies, concluding that this demographic of the corporate world should be looking to implement more disciplined measures in deal-making.

The Survey polled approximately 1,800 companies, of which half comprised of mid-sized companies. These companies’ responses indicate that they are more concerned than their large-cap counterparts with “obtaining bargain-priced … Continue Reading

M&A trends update

Earlier this month, we reported on the slow-down of M&A activity in the first quarter of 2016. Despite this challenging start to the year, a new report from Deloitte & Touche LLP entitled “M&A Trends Report 2016” found that executives remain optimistic about M&A activity going forward. The report provides that 87 percent of the 2,300 U.S. survey respondents said that they expected their deal activity to match or exceed 2015, which was the busiest year ever for mergers and acquisitions.

Respondents in Deloitte & Touche LLP’s survey expected that technology would be the top industry for … Continue Reading

Whither Tech M&A 2016?

According to a recent MergerMarket Group report, the first 11 months of 2015 saw global deal value reach USD $3.88tn, surpassing global deal value for the entirety of 2014. At a glance, it seems the last month of 2015 actually saw an increase in the growth of deal value with the closing of four deals, each valued at over USD $50bn. A major pharmaceutical takeover deal worth a reported USD $183bn served to cap of a year touted by the Wall Street Journal as “the Biggest M&A Year Ever.”

By November’s end, Technology, Media, & Telecoms (TMT) … Continue Reading

Trending topics for banks

Gone are the days when the focus areas for banks were largely M&A and growth. In addition to ever increasing regulatory and compliance obligations, banks are grappling with new technologies and innovations that affect the way in which banks interact with consumers.

Payment technologies continue to advance, with improvements in the security of contactless payments and increasing adoption of electronic peer-to-peer payments. Partially as a result, banks have access to more information about their customers’ behaviour, yielding data and analytics that can be exploited across all banking functions. Of course, the collection and use of “big data” dovetails directly into … Continue Reading

Strong outlook for chemical M&A in 2015

Refinery-680x2202014 was a robust year for global chemical M&A. As in many other industries, low interest rates and plentiful credit boosted global chemical M&A activity, resulting in strong performance in terms of deal flow and deal value compared to 2013. Most notably, in 2014, there were at least 13 acquisitions over US$1 billion in value, which totalled over US$52 billion in value, compared to just 8 such deals in 2013, which totalled just US$13.6 billion.

The strength of global chemical M&A over the last year has industry watchers wondering if 2015 will bring more of the same. Deloitte’s 2015 Global Continue Reading

Momentum of global M&A strong into Q1 2015

Global M&A activity continued its surge in Q1 2015, marking another quarterly increase in deal volume on a trailing twelve month basis, continuing a streak of consecutive increases that began in the first quarter of 2014. The data, published by Deloitte in its M&A Index H1 2015, also measured a $20 billion increase in deal value as well over the same period last year, recording $583 billion worth of deals since the beginning of this year, an increase of over 3.5%.

According to the report, the increase in global M&A deal volume was primarily driven by such factors as … Continue Reading

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