Feb 26, 2019

In 2019's M&A market, less is more

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Data: Dealogic; Includes deals whose targets are North American and publicly listed companies; Chart: Andrew Witherspoon/Axios

In terms of the number of deals, mergers and acquisitions activity is off to the slowest start since 2015. But the deals that have been made this year are much bigger than before.

By the numbers: According to data prepared for Axios by Dealogic, public North American companies have announced 53 deals so far this year — fewer than the 81 in the same period last year.

  • But the deals are valued collectively at $279 billion, outpacing the valuation of deals announced within the same timeframe in the past 5 years.
  • Top executives only expect the numbers to grow: 76% of M&A executives at U.S.-headquartered corporations and 87% of M&A leaders at domestic private equity firms project the number of deals their organizations close over the next year will increase, according to a recent survey by Deloitte.
  • 7 in 10 respondents say they expect the size of those transactions will be larger than the ones brokered in 2018.

Between the lines: The deals so far this year are beating records within their industries.

  • Newmont Mining's $10 billion all-stock takeover of Goldcorp is the biggest deal in the gold sector ever, per Reuters, and would create the world's biggest gold miner.
  • The BB&T-SunTrust tie-up, valued at $66 billion, is the biggest bank deal since the financial crisis.
  • Bristol-Myers Squibb said it would buy Celgene in a cash-and-stock deal worth $74 billion — one of the largest healthcare takeovers of all time.

The bottom line: "Choppy financial markets, trade tensions and fears of an economic slowdown hampered deal makers" a bit in 2018, the Wall Street Journal notes. Those same risks could still dampen the deal activity we've seen so far in 2019.

Go deeper: Half of the 10 biggest bank mergers have resulted in name changes

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