GLOBAL STATISTICAL UPDATE – XBMA Quarterly Review for Third Quarter 2016

Executive Summary/Highlights:

  • Global M&A volume in Q3 totaled approximately US$800 billion, approximately 10% lower than Q2, and over 10% higher than Q1.
  • At its current rate, global M&A volume for 2016 is on pace to reach US$3.2 trillion, approximately the level reached in 2014 but considerably lower than the record levels of 2015.
  • Q3 saw a number of blockbuster deals, including three of the four largest deals in 2016 —the Bayer/Monsanto, Enbridge/Spectra and SoftBank/ARM transactions — all of which were cross-border transactions.
  • Cross-border M&A activity accounted for 43% of global deal volume in Q3, up substantially from 31% in Q2. Four of the 10 largest deals in Q3 were cross-border transactions.
  • European and Chinese M&A activity each accounted for just under 20% of Q3 deal volume, up slightly relative to Q2 and higher than overall levels from 2011-2015.
  • Deals involving U.S. targets accounted for less than 40% of the quarter’s deal volume, below the 50% (or greater) level that has recently prevailed.
  • Global M&A — including large cross-border transactions — is being driven by consolidation in several sectors, search for scale (particularly in new markets), and low-cost acquisition financing.  The slower pace relative to 2015 might be attributable to political uncertainty arising from the U.S. election, the near-term possibility of U.S. interest rate increases from their historical lows, and uncertainty about the economic impact of Brexit on the U.K. and the European Union.

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