Dealreporter has released its full year 2018 Global RiskArb report. According to new research, the Global Public M&A market saw 403 new deals announced in 2018 for a total IEV of USD 1.5 trillion – a 13% increase in volume and a 11.6% increase in value compared to the previous year.
Deals involving target companies with equity valuations of between USD 1bn – USD 5bn represented the most populated group in all three regions. NA saw the most dramatic increase, with deals in this size range representing 51% of the region’s deals, compared to 44% in 2017. NA was followed by AP where deals in this space made up 37% compared to 33% in 2017. In Europe, there was a marginal change with these deals representing 43%, compared to 42% in 2017.
In 2018 the global lapse ratio – the number of deals that failed to complete out of those announced – went down to 17% from 17.8%. AP and NA each accounted for more than a third of total lapsed deals and both experienced the same declining trend – AP’s lapsed ratio went down from 19.3% to 17.2% whereas NA fell from 15.2% to 13.3%. Europe, meanwhile, represented 28% of lapsed deals globally with a lapsed ratio of about 21%, which was steady compared to 2017.
Financial services was among the most active sector across the regions and ranked highest in Europe, accounting for 26% of total deal volume. It was second in NA, accounting for 21% of deal volume, coming just behind TMT and Basic Materials, each accounted for 23%, and first in AP with 19% together with TMT.
Cross-border remains a prevalent feature of the European M&A market with 71% of bidders coming from a country other than that of the target’s headquarters. The rate increased to 71% in 2018 from 58% in 2017. The trend in NA is that of a decline with the incidence of cross border deals gradually shrinking from 33% in 2014 to 21% in 2018. In AP this incidence was 32% in line with the past years.
The duration of a deal shortened on average in NA and AP in 2018 compared to 2017 while it increased in Europe on average by 36 days. The average number of days for a deal to become live from an expected status was longest in NA with 105 days (23 days more than 2017), followed by Europe with 36 days (down 6 days) and AP with 30 days (down 26 days).
To access the full report, please e-mail [email protected].