Value of M&A transactions hit $146.7B: William Buck

The aggregate value of merger and acquisition (M&A) transactions sits at $146.7 billion, the largest value since 2007 according to William Buck.

Despite the levels of deal-making activity slowing since the record highs of 2021, market conditions still appear favourable for those in search of opportunities.

A large percentage of this can be attributed to mega-deals including the sale of Sydney Airport, BHP/Woodside, Ausnet and Afterpay, which equated to $96 billion in total.

Sectors that achieved the highest aggregate sum of transaction value were financials, energy and utilities and consumer.

The largest deals in the financial sector was the Westpac off-market share buy-back worth $3.5 billion and Block, Inc’s acquisition of Afterpay at $16.89 billion.

Energy and utilities saw the Metals Acquisition Corp’s acquisition of Glencore’s CSA copper mine for $1.6 billion as its biggest deal.

Blackstone’s acquisition of Crown resorts via a scheme arrangement worth $8.82 billion was the biggest deal for consumer.

The sectors that dropped the most in deal value year-on-year was technology, media and telecommunications.

A spokesperson at William Buck said, “We do however expect deal-making in the technology and media and communications sectors to experience some resurgence in H2 2022 as the demand for data and digitisation increases.”

While the value of deals has risen remarkably in H1 2022, annualised 2022 deal numbers demonstrate a decline in activity. In H1 2022, 646 transactions were completed, which is nearly a third of the 1815 deals that were undertaken last year.

On average, over the last ten years, transactions with a value up to $50 million accounted for an average of 78 percent of the total number of transactions, while those between $10-50 million accounted for 26 percent and those above $50 million, 23 percent. Meanwhile, foreign buyers have accounted for only 23 percent of the number but 36 percent of the value of all transactions.

Australia’s M&A activity in 2022 has largely mimicked global deal-making, particularly in terms of sector performance. Sectors that dropped the most in deal value year-on-year were also technology, media and telecommunications and consumer products.

Meanwhile, activity in the energy and utility sector increased, driven by higher commodity prices and the Russian energy crisis. The M&A market value of energy and utility deals increased strongly to 13 percent and 10 percent in Q1 and Q2 2022 respectively, in comparison with the previous six months which saw it increase to 6 percent and 9 percent in Q3 and Q4.

Venture Capital aggregate deal value has seen a 42 percent increase in H1 2022 in the same period last year, at $2.62 billion and $1.85 billion respectively. The number of deals has also seen a slight increase from 165 to 175.

IT was the sector with the largest deal value and count in the last 10 years, a trend that continued into the first six months of 2022. VC injections have been on the up and up since 2012, peaking last year at 325 transactions and an aggregate deal value of $6.95 billion.