Topic: Transport

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Global automotive M&A ends 2017 in high gear with no signs of slowing down

As seen in this recent PwC article, global automotive M&A activity was strong in 2017.  Automotive deal value increased 29.9% to $53.2b from 2016 to 2017 primarily as a result of two mega deals in the Auto-Tech sector, which PwC defines as “investments in connectivity, autonomous, electrification, ride-sharing and the software, sensors, intellectual property and other components that support these trends.”  For 2018, it is expected that investments in the Auto-Tech sector will continue to drive global automotive M&A activity.

Auto-tech deals spark M&A activity

Auto-tech deal value increased from $5.3b in 2016 to $26.7b in 2017. Further, deal volume … Continue Reading

M&A: the automotive industry’s new fuel?

Automotive technologies are evolving rapidly and impacting not only drivers’ automotive experiences but also, the automotive industry more broadly. From assistive technologies like bicycle sensors and back-up cameras to self-driving technologies, it appears that technological innovation will be critical in order for automotive companies to maintain their relevance and competitive edge in the marketplace. However, such innovation is complicated and largely outside of the auto industry’s wheelhouse. As a result, merger and acquisition (M&A) activity may be just the tool that these companies need for harnessing this innovation and competing effectively.

The automotive industry transformation

As alluded to … Continue Reading

M&A in Canada: industry revenue and profits

Expanding growth in nearly all sectors

Norton Rose Fulbright focuses its services on 6 key industry sectors and, according to a study released recently by the Globe and Mail on Canadian corporations, almost all of these sectors have seen an expansion in revenue and most have seen growth in profits during the period from 2011 to 2015. While such expansion does not on its own drive M&A activity, it is important factor for identifying trends. Industries with the greatest growth may see increased M&A activity in the future; likewise industries with prolonged under-performance may be primed for consolidation.

Banking

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The … Continue Reading

Statistics Canada announcement fuels interest rate speculation

Statistics Canada’s June 30, 2015 announcement regarding the nation’s economic results for the month of April, measured in terms of national Gross Domestic Product, has many bankers and financial institutions predicting another Bank of Canada interest rate cut sometime during 2015.

Although real GDP fell by only 0.1% in April, the decrease marks a fourth consecutive monthly decline.  Canada’s poor economic performance of late is owed, in part, to the fall in oil and gas extraction as conventional crude and non-conventional oil companies combined for a 3.4% month-over-month production cutback.  Statistics Canada pointed to maintenance shut downs and production difficulties … Continue Reading

Significant M&A activity reported in the aviation sector in Q1 2015

jet-680x220ICF International has released its seventh edition of Aviation and Aerospace M&A Quarterly – a publication highlighting merger and acquisition deals and trends in the aircraft, airlines, and aerospace sectors. This most recent publication focuses on the first quarter of 2015, reporting strong activity through significant investments in these sectors across the world in North America, Europe, and Asia-Pacific. Throughout these regions, most investments were seen by Asia-Pacific buyers investing in North America or Europe, however there was still some deals seen by North American buyers completing transactions in Europe.

The publication reports the aircraft sector was booming with various … Continue Reading

M&A expectations on the rise

SkyscrapersEY has recently released the 12th edition of its annual Global Capital Confidence Barometer, a biannual survey of more than 1,600 executives of companies in 54 countries, assessing various metrics in global mergers and acquisitions. Although 2014 marked the single largest increase in M&A since the financial crisis of 2008, for the first time in five years, more than half of the respondents of the survey indicated that they are planning acquisitions in the next year, signalling recovered earnings and cash positions, or at the very least, increased optimism regarding the trajectory of markets. The survey points out … Continue Reading

Aerospace and defense M&A returns to cruising altitude

jet

CaptureFollowing a pullback in fiscal year 2013, deal activity in the global aerospace and defense (A&D) sector has returned to its former levels.

According to PwC’s Mission Control report for Q4 2014, the past year witnessed the total A&D deal value rebound from $14.3 billion in 2013 to $22.3 billion in 2014, which is on par with the 10-year rolling average.

Canada is a major player in the A&D sector: historically it is fifth, behind the United States, France, the United Kingdom and Germany in total revenue generated by A&D but second, behind the United States, in … Continue Reading

Acquisitions of freight carriers and other commercial vehicle operators: the road to regulatory compliance

Transport by road is a major and developed industry in Canada and the United States. The acquisition of a freight carrier – a commercial vehicle operator – may trigger varying levels of regulatory registration and compliance requirements, depending on how the transaction is structured. The same concerns will often arise in acquisitions of entities that are not freight carriers, but operate a commercial vehicle as part of their business. The regulatory framework applicable to commercial vehicle operators can be surprisingly complex and should be taken into account when acquisitions are contemplated.

Generally, freight carriers have three basic types of regulatory … Continue Reading

Hot market report: M&A potential for auto dealerships

In their Q3 2014 Capital Markets Flash, PriceWaterhouseCooper (PwC) reports that
“[t]here’s a lot of positivity within the Canadian auto dealership industry, which should come as no surprise given record sales that were almost unimaginable a few short years ago.” Since PwC’s Q3 update, the Canadian Automobile Dealers Association (CADA) published the industry’s October economic report, and the numbers keep looking better.

The Canadian light vehicle market has set seven consecutive monthly sales records with total sales 6% above 2013’s record setting numbers and truck sales increasing by 10%. Revenues at dealerships are also setting … Continue Reading

The effect of government privatization on global M&A

RR Donnelly released the August edition of its Venue Market Spotlight, entitled Government Privatizations and M&A. In the report, a high-level summary of a survey of experts, RR Donnelly speaks to the effect that government asset sales and other forms of privatization are having on global M&A activity. The report forecasts that government privatization will become a key driver in the next 12 months and beyond.

This post will survey a number of aspects of this burgeoning phenomenon as summarised in the RR Donnelly report.

Growth, generally and by sector

Not surprisingly, 86% of respondents project a rise in … Continue Reading

Facilitating cross-border M&A: the Canada-Korea free trade agreement

The end of last month saw the signing of the Canada-Korea Free Trade Agreement (CKFTA) following nearly ten years of negotiations. It marks Canada’s first major free trade deal in the Pacific Asia region.

The Canadian Department of Foreign Affairs, Trade and Development has highlighted benefits including job creation, increased access to Asian markets and the creation of a level playing field for Canadian businesses competing with other trade and investment partners of the South Korean peninsula. Specifically, the CKFTA will foster increased M&A activity across the Pacific by establishing and reinforcing rules that secure a transparent and … Continue Reading

PWC predicts moderate growth in Canadian M&A

In its Q2 2014 Capital Markets Flash: Canadian M&A Deals Quarterly, PricewaterhouseCoopers forecasts moderate growth in Canadian economy in the next year and a half. It predicts the rate of real economic growth in 2015 to be 2.5% compared to 2.2% in 2014 and 2.0% in 2013; it projects that government spending will increase 1.5% in 2015, compared to 1.0% and 0.4% in 2014 and 2013, respectively; and it anticipates that the biggest change will be in business investment growth, which is anticipated to be a significant 4%, compared to 1.5% in 2014 and 1.4% in 2013. 

In the … Continue Reading

Private equity’s role in a distressed shipping market

This legal update originally appeared in Norton Rose Fulbright’s April 2014 Shipping Newsletter – Legalseas. For more, please contact either Brad Berman or Brian Devine from our New York office. 

Private equity (PE) is an asset class consisting of equity investment in companies that are not publicly traded on a stock exchange. With the decline in industrial and consumer demand following the worldwide economic pullback beginning in 2008, the shipping industry, still working through oversupply six years later, is an obvious target.

For some ship owners, PE is hailed as the panacea for saving an otherwise distressed … Continue Reading

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