The coronavirus crisis slammed the brakes on big mergers and acquisitions deals in March, with activity in the second quarter of 2020 slumping to an 11-year low of $485.3bn as company executives instead focused on stemming losses caused by the crisis.
While Microsoft’s potential TikTok takeover may be one of the most closely watched M&A transactions amid the pandemic, mega-deals have been making a comeback in recent months.
After deal volumes slumped to $248bn in April and May, according to Dealogic data, they jumped by nearly 140% in June and July to $589.5bn, even if this lags the same period last year.
These are the biggest M&A deals to come to the market during the pandemic.
1. Petrochina’s $38.4bn oil and gas pipeline sale – July
State-owned oil and gas firm, PetroChina, announced it was selling a major part of its oil and gas pipelines – and storage facilities – to China Oil and Gas Pipeline network (also known as PipeChina) on 23 July. The deal, valued at $38.4bn, is the biggest of 2020, with Goldman Sachs and UBS the only international banks on the roster with a number of local advisors. The transaction has helped propel Chinese banks China International Corp and CITIC Securities into the top 10 M&A advisers so far this year.
2. Willis Towers Watson’s $30bn tie-up with rival Aon – March
Just seven days before the UK went into full lockdown on 16 March, two insurance giants unveiled the biggest M&A deal of the year so far. The tie up between Willis Towers Watson and Aon had been on the cards for over a year, but the deal was formally announced on 9 March. The merger, due to complete in the first half of 2021, will create a global giant with a value of around $80bn. Advisers were Goldman Sachs, Bank of America, Credit Suisse and Morgan Stanley.
3. Analog Devices’ $21bn acquisition of rival Maxim – July
In what was seen as a sign of increasing consolidation in the US semiconductor industry, Analog Devices swooped on rival Maxim Integrated Products in July in a deal worth around $21bn in stock that will create a company with a combined market value of $68bn. JPMorgan, Morgan Stanley and Bank of America were named as advisers.
4. Seven & i’s $21bn purchase of Speedway – August
Seven & i Holdings, the Japanese owner of US convenience store chain 7-Eleven, struck a $21bn all-cash deal to acquire petrol station owner Speedway, which is owned by the US’s biggest oil refiner Marathon Petroleum. The deal means that Seven & i will add around 4,000 stores across the US and Canada. The transaction was reportedly heavily contested, with Seven & i outbidding its competitors by $4bn. The companies were advised by Barclays, JPMorgan, Credit Suisse, Nomura and Sumitomo Mitsui Financial Group.
5. The $18.5bn merger of digital health groups Livongo and Teledoc – August
Digital health groups Livongo and Teledoc announced plans to merge in August amid a surge in demand for their services during the pandemic. The deal, valued at $18.5bn, brings together two firms that offer high-tech solutions to healthcare problems including hypertension and diabetes. Morgan Stanley and Lazard were the banks on the deal.
Source: Private Equity News
