The press was filled this month with mega-deals such as Deutsche Börse coming together with the London Stock Exchange in a $30 billion merger; Markit and IHS merging in a $10 billion deal; and Nasdaq acquiring the ISE Options Exchange. But for us, it’s some of the smaller deals this past month that seem both interesting and particularly relevant in light of some of our recent blog pieces.
Through early February, announced capital raising and M&A transactions in the payment technology sector have already exceeded $7 billion. If this pace continues, transaction value could exceed the $47 billion in 2015. The question is: given the volatility in the public equity markets, difficulties in the technology IPO market and macroeconomic concerns, will the transaction activity continue? We think it will.
This month’s M&A Market Update follows presents a fairly strong picture of the m&a market in the dozen plus sectors that we follow and sometimes lead. It’s comforting to know that some markets are solid while the global economy as well as the global stock, bond and commodities markets largely seem to muddle along: more down than up lately.
After a very strong 2015, in which m&a activity by value soared to record levels – exceeding 2007 highs, 2016 has started out with a series of earth tremors. Among other things, the price of oil (and several other commodities) dropped to lows not seen in more than a decade; the bottom seemed to drop out of the Chinese stock market; and the stock and bond markets in the US and Europe slid in seeming sympathy. Recently, several high flying tech companies raised capital at values lower than previously indicated. So what will 2016 bring?
Earlier this week, to start the New Year, I was privileged to attend a breakfast discussion led by Bo Cutter, Senior Fellow of the Roosevelt Institute; formerly a member of President Clinton’s National Economic Council, President Carter’s Executive Director for Budget, and Chief Economist at Warburg Pincus. Cutter asked another guest to speak, Frank Wisner. Among other things, Mr. Wisner was the U.S. Ambassador to Egypt, Philippines and India; a former Undersecretary of State; and a former Undersecretary of Defense. He served in the administrations of Presidents Reagan, Carter, George HW Bush, and Clinton. In 2011, President Obama asked Wisner…