Climate change has become a high profile issue that is expected to have significant implications for M&A transactions going forward. As public awareness and scientific understanding of climate change continues to evolve, we are more informed about the climate change-related risks that businesses must grapple with and get ahead of. As a result, businesses need to be especially diligent in their assessment of a range of factors that may be impacted by the changing climate when completing M&A transactions. While the risks that should be considered will, of course, vary between transactions, the following is a list of climate-related factors … Continue Reading
A recent report by Ernst & Young (the Report) has concluded that the power and utilities (P&U) is thriving, as global deal value in the first quarter of 2018 reached an all-time high of US$97 billion. This rise has predominately been driven by mega-deals, with only 15 deals forming 90% of the total global deal value in the P&U sector. Owners of P&U assets can continue to expect premium asset valuations and highly favourable transaction terms as investors compete for a limited amount of attractive investment opportunities within the sector.
The Report identifies the following factors as … Continue Reading
Canada continues to be an attractive market for private equity (“PE“) investors with recent transactions highlighting significant investments into Canadian real estate and energy infrastructure assets.
Partnerships (particularly, limited partnerships) continue to be a popular PE vehicle, providing a means of pooling and aggregating investment funds and allowing for income or losses to be “flowed-through” to its members for Canadian tax purposes, subject to certain exceptions.
However, the use of partnerships with non-resident investors in PE investments raises two particular issues.
Part XIII of the Income Tax Act (Canada) (the “Tax Act“), requires that … Continue Reading
The value of Canadian M&A activity in the first half of 2017 was the highest in a decade, according to a recent report from Bloomberg. The approximately $132 billion in total transaction value is the highest since the first half of 2007, when approximately $156.6 billion in transactions were completed.
According to the report, one of the most significant drivers of deal value was a sell-off of Canadian oil sands investments by foreign energy companies in the wake of declining prices for crude on global markets. Recent examples of such transactions include Royal Dutch Shell’s divestment of its interests … Continue Reading
On April 25, Mergermarket released its Q1 2017 Regional Flash Reports describing the M&A climate, trends and developments throughout the Americas during the first quarter of 2017.
The Canada’s Trend Report indicates that Canadian M&A has remained strong with 111 deals in Q1 2017 worth US$ 35.8bn. This is a robust start for 2017 as compared to the 151 deals in Q1 2016 representing US $17.1bn, and is in line with the trend of higher valuations for fewer deals as seen across the globe. The top Canadian sector for Q1 2017 was Energy, Mining and Utilities (EMU) with … Continue Reading
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
MergerMarket Group recently published its September edition of Monthly M&A Insider which reported on mergers and acquisitions activity around the world for the month of August 2016. More than two thirds into the year, August was no exception to the recent rather sluggish growth in M&A activity, especially compared to the record-breaking year for M&A in 2015.
August saw a total of 946 deals worth US$182.2bn, the lowest-valued August since 2013 (US$152.7bn) and down 34.7% from August 2015’s US$278.9bn. The Energy, Mining & Utilities sector spearheaded activity by contributing 15.8% to the total global market share with 84 … Continue Reading
According to MergerMarket’s Monthly M&A Insider Report, global M&A activity continued to wane throughout May 2016, maintaining the trend reported on earlier this year. May 2016 resulted in a total of 1,054 deals worth an aggregate of US$224.5 billion, down from the 1,410 deals valued at US$372.5 billion in May 2015. Energy, Mining & Utilities, the sector with the strongest showing, lead with 80 deals worth US$40.5 billion, representing a 66.8% increase in value (but a 17% drop in the number) from deals in this sector in May 2015.
The report highlighted the following regarding global M&A activity:… Continue Reading
2015 was an extraordinary year for global M&A activity. Mergermarket recorded almost 17,000 transactions worth a remarkable US$4.3tn. This topped the previous record set in 2014 by over 30%. The race for top performing sector this year was very close. Energy Mining & Utilities won with US$630bn in deal value; however, the top performers were only separated by US$150bn. The other four sectors in order are: Pharma, Medical and Biotech, Consumer, Financial Services and Industrial Chemicals.
Once again North American markets lead the way with almost 1/3 of global deals and nearly 50% of global deal value. The … Continue Reading
The first half of the decade has seen a swift rise in green-house gas (GHG) emissions in Asia. Consequently, China is now the world’s largest emitter of carbon dioxide from the consumption of energy, accounting for over 25% of global emissions. This rapid intensification has also created an active and robust renewable energy market in China and other Asian countries.
According to a report published by Mergermarket, the renewable energy market in the Asia-Pacific is poised for significant increases. In 2014, Asia-Pacific accounted for 23.2% of worldwide deal value in renewables, and in H1 2015 rose … Continue Reading
Similarly to American M&A in the first half of 2015, the first half of 2015 was remarkably active on the global mergers and acquisitions front. According to a recent Mergermarket report, total deal value topped US$1.7 trillion. This represents an increase of 15.2% over the first six months of 2014, and only 15.4% behind the record-setting first half of 2007, when US$2.1 trillion worth of deals were completed. With 7,136 transactions, it is interesting to note that total deal volume actually decreased by 15.7% compared to the same time period last year, but higher valuations explained the market’s … Continue Reading
Mergermarket published its M&A Monthly Insider for May of 2015 earlier this week, summarizing M&A activity around the world, and particularly in the regions of North America, Central and South America, Europe, Middle East and Africa, Asia-Pacific, and Japan.
To date in North America, there have been 1,516 deals worth US $407.2 billion. April 2015 saw 319 deals signed that were worth US $55.7 billion, which represented a 56.3% decrease in value compared to April 2014. Domestic M&A dominated North America for April 2015 with US $45.8 billion in deals. Cross-border M&A deals decreased in value compared to April 2014, … Continue Reading
The decrease in the price of oil and resulting available capital may create a surge of investment in cleantech, renewable energy and electricity in Ontario, and Queen’s Park appears to be doing all that it can to aid this East-bound capital flight.
The Liberal government’s much publicized plan to liberalize the electricity sector and privatize 10% – 15% of Ontario Hydro, the Province’s transmission giant, is an attempt to both finance long-term infrastructure projects and take advantage of US investors looking to capitalize on an undervalued asset. The depreciated price for a non-controlling interest in a multi-billion dollar asset will … Continue Reading
The Mergermarket Group has published its Monthly M&A Insider – April 2015 report outlining trends and developments in M&A activity worldwide for the first quarter of 2015.
In North America, M&A activity continued on the upward trend set in 2014. The first quarter saw 1,116 deals valued at US $338.8 billion, which was a 11% increase compared to the first quarter of 2014. This increase was in no small part driven by the Heinz/Kraft deal, valued at $54.4 billion. The Pharmaceutical, Medical and Biotech industry was also a significant driver in the first quarter of 2015, which saw 122 deals … Continue Reading
MergerMarket Group recently published its January edition of Monthly M&A Insider which reported on mergers and acquisitions activity around the world during the second half of 2014. Among other things, the report explains why 2014 was so hospitable to M&A activity, citing an improving economy, large cash reserves, low interest rates, and cheap financing as contributing factors.
Overall, there were 16,588 reported deals in the second half of 2014 worldwide, worth roughly $3.2 trillion; this surpasses the previous record, in the second half of 2007, of 16,060 transactions, worth roughly $3.7 trillion. Just under half of the total … Continue Reading
A recent report released by Deloitte announces that the number of Canadian deals in the energy sector has risen by 15% in the first half of 2014, compared with the same period in 2013.
The Deloitte Oil & Gas Mergers and Acquisitions Midyear 2014 Report offers an optimistic outlook for sector’s global deal activity, with Canada well positioned to benefit from the upswing.
Canada is at the centre of global deal activity
The global deal value in the energy sector has risen by 38%, to $141 billion this year, with Canada and the United States at centre of the activity, … Continue Reading
On Monday, Whitecap Resources (TSX:WCP) announced that it had agreed to buy a number of oil and gas properties from Imperial Oil Ltd. (TSX:IMO) for $855 million. This transaction comes on the heels of renewed M&A activity in the energy sector. According to the Globe and Mail, this deal “pushes the industry’s tally for merger and acquisition activity for the quarter to $7-billion, nearly 10 times the total for the first three months of 2013”.
There are a number of reasons for this turnaround, including a rebound in Canadian energy prices. This is in part due to the fact … Continue Reading