October was a bumper month for mergers and acquisition activity, with the second-highest monthly tally of “mega deals” on record.
Nineteen mega deals – worth $5bn or more – were announced last month, a monthly tally exceeded only once, in May 2007, according to data from Refinitiv.
Since 1 January, 93 mega deals have been announced, compared to 81 during the same period last year, and slightly lower than the 101 recorded in 2018. The combined value for the year is $1.2 trillion, down 14 per cent on the same period last year.
Global deal value across October totalled $388.2bn, bringing the total value to $2.7 trillion for the year. October’s deals fell 20 per cent from September to total but mark a 21 per cent from October 2019 and the highest October in four years.
“Only 2015 [saw] a stronger start to the second half since our records began in the 1970s,” Lucille Jones, deals intelligence analyst at Refinitiv said.
A strong start to the second half has in part been due to a pickup in activity since lockdown restrictions started to ease globally.
Private equity-backed deals soar as restrictions ease
Private equity has had a particularly busy second half as many firms closed in on struggling corporates in a busy summer of deal-making.
Private equity backed M&A totalled $49bn during October, 10 per cnet lower than the value recorded in the previous month, but the highest October total in 14 years.
The acquisition of supermarket Asda by the billionaire Issa Brothers and private equity firm TDR Capital was one of last month’s biggest deals, at £6.8bn.
TDR and the Issa brothers, who own EG group, will hold majority ownership. They fought off competition from US private equity firm Lonestar, which last week bid £640m for homebuilder McCarthy & Stone.
The value of the more than six thousand private equity deals announced this year is up three per cent on last year at $416.6bn and the highest year-to-date total since 2007, according to Refinitiv.
While private equity firms circle embattled corporate firms, tech deals continued to dominate last month. Deals in the sector totalled $85.7bn during October, a monthly value exceeded only once in the last two years.
Technology deals account for 17 per cent of global M&A by value this year, the highest share of all time, totalling $474.4bn so far this year.
The London Stock Exchange is close to completing its $27bn acquisition of data provider Refinitiv.
Earlier this month LSE agreed the sale of Borsa Italiana as part of remedies to appease the European competition watchdog.