6th Annual Brunswick Group M&A Survey

2,773 views

Published on

The 6th Annual Brunswick Group M&A Survey polled over 100 top advisors from North America, Greater China, and Europe on their views about the current deal landscape and trends.

Published in: Business
0 Comments
1 Like
Statistics
Notes
  • Be the first to comment

No Downloads
Views
Total views
2,773
On SlideShare
0
From Embeds
0
Number of Embeds
522
Actions
Shares
0
Downloads
18
Comments
0
Likes
1
Embeds 0
No embeds

No notes for slide

6th Annual Brunswick Group M&A Survey

  1. 1. 6th AnnualM&A Survey
  2. 2. FOR THE SIXTH CONSECUTIVE YEAR, the Brunswick Group M&A Survey haspolled leading deal practitioners on their outlook for the coming year’s deal landscape and trends. Thisis the first year soliciting European advisors’ views and the second with insights from Greater China.Over 100 top deal bankers and lawyers participated in this year’s global survey, and their views indicatethat 2013 is shaping up to be a banner year:• 2013 opens with record-setting confidence in the global M&A landscape with North America- based, Greater China-based and Europe-based advisors expecting deal activity globally to increase (82%, 74%, and 88%, respectively) over 2012. 97% of North American advisors see activity within North America increasing in 2013.• North American and European advisors see this uptick being driven by strong CEO and Board confidence (64% and 72%, respectively, see this as the key driver), while 69% of Greater China- based advisors see growing appetite among Chinese State Owned Enterprises for outward expansion as the top factor.• North America-based advisors see M&A activity as more likely among domestic players (71%) than inbound (18%) or outbound (3%) pursuits; Greater China-based advisors see M&A activity being driven by Chinese companies pursuing outbound deals (77%); and Europe-based advisors see foreign companies pursuing deals within Europe (59%) driving local M&A activity.• In North America, the ripest sectors seen for consolidation are consumer goods (31%) and technology and telecoms (22%), while manufacturing (20%), technology (20%) and consumer goods (16%) are expected to fuel activity in Greater China. In Europe, energy and financial services are expected to drive the uptick (24% see each as the most active sector).• 89% of North America-based advisors expect leveraged buyouts to make a major comeback in 2013.The results of the survey are released ahead of the 25th Annual Tulane University Law School CorporateLaw Institute, the leading M&A conference in the U.S. that draws lawyers, bankers, Delaware judges,proxy solicitors and other members of the deal community.For further information: www.brunswickgroup.com/insights-analysis/surveys.aspx
  3. 3. 1a. Compared to 2012, do you expect the level of North American 1. Compared to 2012, do you expect the level of Northin 2013? M&A will increase, decrease or stay the same level American M&A will increase, decrease or stay at the same level in 2013? 92% 97% 78% 48% 42% 22% 8% 10% 0% 3% 0% 0% 2010* 2011** 2012 2013 Increase Stay the same DecreaseNorth American advisors are overwhelmingly bullish on North American deal activity for thecoming year with not a single respondent expecting a decrease in North American deal flowduring 2013. * In 2010, the question was written as “Given the Level of M&A in Q1, do you expect activity for the rest of 2010 to…?” ** In 2011, the question was written as “Given the level of domestic M&A in Q1, do you expect activity for the rest of 2011 to:”* In 2010, the question was written as “Given the Level of M&A in Q1, do you expect activity for the rest of 2010 to…?”** In 2011, the question was written as “Given the level of domestic M&A in Q1, do you expect activity for the rest of 2011 to:”
  4. 4. 1b. Compared to 2012, do you expect the level of Greater China M&A Q1b. Compareddecrease or stay the same level in of Greater China will increase, to 2012, do you expect the level 2013? M&A will increase, decrease or stay at the same level in 2013? 67% 76% 30% 20% 4% 4% 2012 2013 Increase Stay the same DecreaseTwo thirds of advisors surveyed in China expect an uptick in M&A in Greater China in 2013(67%), down from 76% in 2012.
  5. 5. 1c. Compared to 2012, do you expect the level ofof European M&A will 1c. Compared to 2012, do you expect the level European M&A willincrease, decrease or stay at the same level in 2013? increase, decrease or stay the same level in 2013? 61% 33% 6% Increase Stay the same Decrease61% of Europe-based advisors see M&A increasing within the region in 2013, while a third(33%) believe the level of activity will stay the same and 6% see a decrease.
  6. 6. 2. Compared to 2012, do you expect the level of global M&A will2a. Compared to 2012, do you expect the level of global M&A willincrease, decrease or stay at thethe same level 2013? increase, decrease or stay at same level in in 2013? 3% 23% 15% 28% 82% 49% 2012 2013 Increase Stay the same DecreaseNorth America-based deal practitioners expect to see increased global activity in 2013, up33 percentage points from a year earlier, with just 3% expecting a global decline in deal flow.
  7. 7. 2b.Compared to 2012, do you expect the level of global M&A will Q2b. Compared to 2012, do you expect the level of global M&A will increase, decrease or stay at the same level in 2013?increase, decrease or stay at the same level in 2013? 8% 4% 22% 36% 74% 56% 2012 2013 Increase Stay the same DecreaseThree in four (74%) Greater China based advisors expect global M&A activity to be on therise this year, up from 56% last year.
  8. 8. Q2c. Compared to 2012, do you expect the level of global M&A willincrease, decrease or stay at the same level in 2013? 2c.Compared to 2012, do you expect the level of global M&A will increase, decrease or stay at the same level in 2013? 88% 12% 0% Increase Stay the same Decrease Nine in ten (88%) European advisors foresee an increase in global deals this year and 12% expect levels to be consistent with last year. Not a single European advisor that was surveyed expects a decrease in global M&A this year.
  9. 9. 3. Compared to 2012, do you expect the level of North American3. Compared to 2012, do you expect the level of North American corporate spinoffs and divestitures will increase, decrease or or stay the corporate spinoffs and divestitures will increase, decrease stay at at same level in 2013? 2013? the same level in 6% 33% 61% Increase Stay the same DecreaseThree in five North American advisors (61%) see corporate spinoffs and divestitures inNorth America rising in 2013, while 33% see the level staying the same and 3% see adecrease in 2013.
  10. 10. 4. What areare the key factors that will drive North American 4a. What the key factors that will drive M&A in 2013? Please select M&A in 2013? Please select the top three.the top three. CEO / Board confidence 64% 61% Improving economy* 53% 70%Greater availability of credit and low interest rate 45% environment** 63% Shareholder activism / pressure from investors 44% 28% More cash on balance sheets** 36% 63% Equity market rebound in U.S.*** 30% 20% Cost cutting / synergies**** 6% 15% 2013 Other***** 8% 2012 Strong CEO / Board confidence is seen as the primary driver of increased M&A in 2013 while the improving economy and availability of credit will also help fuel the projected uptick in 2013 M&A activity. * In 2012, “Improving economy” was fielded as “Economic conditions”* In 2012, “Improving economy” was fielded as “Economic conditions”**** 2012, “More cashcashbalance sheets” and “Greater availability of creditof credit interest rate environment” were combined and fielded asand fielded In In 2012, “More on on balance sheets” and “Greater availability and low and low interest rate environment” were combined“More cash on balance sheets / availability of credit”of credit” as “More cash on balance sheets / availability*** In 2012, “Equity market rebound in U.S.” U.S.” was fielded as “Equity recovery” *** In 2012, “Equity market rebound in was fielded as “Equity market market recovery”**** In 2012, “Cost cutting / synergies” was fieldedfielded as “Emphasis cutting /cutting / synergy benefits” **** In 2012, “Cost cutting / synergies” was as “Emphasis on cost on cost synergy benefits”***** Not asked in 2012 ***** Not asked in 2012
  11. 11. Q4b. What are the key factors that will drive M&A in 2013? Please4b.select top three. factors that will drive Greater China M&A in 2013? What are the key Please select the top three. Growing appetite among Chinese SOEs for outward expansion* 69% 84% Opportunities in struggling Western economies 58% 72% Growing appetite among privately-owned Chinese companies for 38% outward expansion* 84% A more favorable political environment following elections / 31% leadership transition in the US & China** Greater availability of credit and low interest rate environment*** 27% 36% Improving economy**** 19% 36% More cash on balance sheets*** 15% 36% Shareholder activism / pressure from investors 15% 4% CEO / Board confidence 12% 4% Cost cutting / synergies***** 8% 4% 2013 0% Other 8% 2012There remains clear consensus among deal advisors in China that state owned entities havea strong appetite for outward expansion by pursuing foreign companies (69% see as the keydriver2012,2013, appetite among Chinese SOEs for outward expansion “ and “Growing appetite among privately-owned Chinese companies for outward * In in “Growing compared with 84% in 2012). expansion” were combined and asked as “Growing appetite for outward expansion among Chinese companies” ** Not asked in 2012.* In 2012,2012, “More appetite among Chinese SOEs for outward expansion “ andrate environment” were combinedprivately-owned Chinese *** In “Growing cash on balance sheets” and “Greater availability of credit and low interest “Growing appetite among and fielded as “More cash oncompanies for outward expansion” were combined and asked as “Growing appetite for outward expansion among Chinese companies” balance sheets / availability of credit”** Not asked in 2012. economy” was fielded as “Economic conditions” **** In 2012, “Improving*** In 2012,2012, “Cost cutting balance sheets” and “Greater availability of / synergy benefits”interest rate environment” were combined ***** In “More cash on / synergies” was fielded as “Emphasis on cost cutting credit and lowand fielded as “More cash on balance sheets / availability of credit”**** In 2012, “Improving economy” was fielded as “Economic conditions”***** In 2012, “Cost cutting / synergies” was fielded as “Emphasis on cost cutting / synergy benefits”
  12. 12. 4c. What are the key factors that will drive European M&A in 2013?select 4c. What are the key factors that will drive M&A in 2013? Please Please select the top three. top three. CEO / Board confidence 72% Greater availability of credit and low interest 56% rate environment Cost cutting / synergies 50% More cash on balance sheets 39% Shareholder activism / pressure from investors 28% Improving economy 17% Further development of the Euro Crisis 6% Other 17%Europe-based M&A advisors see rising CEO / Board confidence and attractivefinancing opportunities as key drivers for M&A in 2013 (72% and 56%, respectively,see these as key factors).
  13. 13. 5. What type of deals do you expect to drive the North American M&A5a. Whatin 2013? deals do you expect to drive the North American market type of M&A market in 2013? Domestic transactions among strategic buyers – 71% $$$ Private Inbound – equity – 8% foreign acquirers into the Outbound – U.S. – 18% U.S. acquirers outside of the U.S. – 3%Deals among domestic players are overwhelmingly seen (71%) as the most likely driverof the 2013 North American deal market and inbound pursuits remain a consideration(18%), while outbound (3%), and private equity (8%) plays are expected to take aback seat in 2013.
  14. 14. Q5b. What type of deals do you expect to drive the Greater China M&A market in 2013?5b. What type of deals do you expect to drive the Greater China M&A market in 2013? Outbound – Greater China acquirers outside of Greater China – 77% Domestic transactions among strategic buyers – 12% $$$ Private equity – 12%Looking at what types of deals will drive M&A in Greater China, three fourths ofChina-based advisors surveyed (77%) see Chinese companies pursuing foreign opportunitieswhile 12% expect domestic transactions among strategic buyers and 12% expect privateequity to dominate the landscape.
  15. 15. 5c. What type of deals do you expect to drive the European M&A market in 2013?5c. What type of deals do you expect to drive the European M&A market in 2013? Private equity – 18% Domestic transactions Outbound – European among strategic buyers – acquirers outside of 6% Europe – 18% Inbound – foreign acquirers into Europe – 59%Looking at what types of deals will drive M&A in Europe, three in five Europe-basedadvisors surveyed (59%) see foreign acquirers pursuing opportunities within Europewhile 18% expect private equity and 18% see European companies pursuing foreignopportunities to be key factors.
  16. 16. 6.6a. What sector do you anticipateisismost ripe for consolidation in 2013? What sector do you anticipate most ripe for consolidation in North America in 2013? 4% 2% 2% Other 5% 5% 2% 6% 5% 2% 5% Automotive 8% 8% 14% 10% Utilities 17% 14% 24% 17% Media 15% Metals / Mining 24% 21% Industry / Engineering 25% 22% Financial services 18% 17% Healthcare 15% 13% 13% 31% Energy 14% 10% Technology & Telecoms 9% Consumer goods / Retail 2009 2010 2011 2012* 2013 For the first time, deals in the consumer goods sector are seen as the most likely, with the percentage of advisors selecting that sector as the most active tripling since 2011 (31%, up from 10%). The technology / telecoms (22%) and energy sectors (15%) are expected to also be ripe for consolidation in 2013.* No data for 2012 * No data for 2012
  17. 17. Q6b. What sector do you anticipate is most ripe for consolidation in2013?* sector do you anticipate is most ripe for consolidation in6b. What Greater China in 2013? 0% 8% Other 16% 0% 4% Healthcare 0% 4% 8% 4% Logistics 8% Financial services 16% 8% 0% Property 8% 4% Transportation 20% 16% Raw / Industrial materials Energy 20% 20% Consumer goods / Retail Technology 4% 20% Manufacturing 12% 2012** 2013 Among China-based advisors surveyed, the ripest sectors for consolidation are manufacturing (20%), technology (20%) and consumer goods (16%).* “Telecoms” and “Utilities” were fielded in 2012 and 2013, but received 0% each year.** In 2012, question was asked as “In what sector in Greater China do you expect to see the greatest amount of consolidation in 2012?” * “Telecoms” and “Utilities” were fielded in 2012 and 2013, but received 0% each year. ** In 2012, question was asked as “In what sector in Greater China do you expect to see the greatest amount of consolidation in 2012?”
  18. 18. 6c. What sector do you anticipate is most ripe for consolidation in 2013?*6c. What sector do you anticipate is most ripe for consolidation in Europe in 2013? 6% Financial services 6% Energy 24% 6% Industry / Engineering 6% Automotive Healthcare 12% Technology & telecoms Utilities 24% Metals / mining 18%The financial services and energy sectors in Europe are expected to be the busiest in 2013,with one in four (24%) advisors surveyed in Europe believing each will be the ripest forconsolidation.* “Consumer goods / retail” and “Media” were also fielded but each received 0%.* “Consumer goods / retail” and “Media” were also fielded but each received 0%.
  19. 19. 7a.What region do you anticipate the most foreign acquirers into North 7. What region do you anticipate the most foreign acquirers into American coming from in 2013? North America coming from in 2013? Europe – 23% Asia – 61% Australasia – 5% Latin America – 11%Asia is expected to be the predominant foreign buyer in North America (61%), but less sothan last year when it peaked with 78% of expected in-bound activity. 23% of respondents seeEuropeans as the most likely buyer, while 11% see Latin America as a possible acquirer, markinga steady uptick in the second year it has been considered in the survey (from 4% in 2012).
  20. 20. 7b.What region do you anticipate the most foreign acquirers into 7b. What region do you anticipate the most foreign acquirers into North American coming from in 2013? Greater China coming from in 2013? Europe – 12% North America – 58% Middle East – 8% Latin America – 4% Australasia – 19%For Greater China based advisors, North America is expected to continue to be the topforeign buyer in Greater China (58%). Fewer respondents expect Europeans to be themost active in Greater China this year (12%, down from 21%), while more advisors seebuyers from Latin America (19%, up from 13%), the Middle East (8%, up from 4%), andAustralasia (4%, up from 0%) on the rise.
  21. 21. 7c. What region do you anticipate the most foreign acquirers into 7c. What region do you anticipate the most foreign acquirers into North American coming from in 2013? Europe coming from in 2013? North America – 61% Asia – 39%European advisors believe foreign acquirers are most likely to come from North America(61%), with Asia closely behind (39%).
  22. 22. 8a. Do you expect to see more deals using:8. Do you expect to see more deals using: 69% 63% 57% 66% 28% 38% 35% 27% 6% 5% 3% 5% 2010 2011 2012 2013 All cash All stock A mix of cash and stockFor the fourth consecutive year, advisors in North America expect an increase in the numberof deals being done with all cash (69%), as opposed to a mix of cash and stock (27%), or allstock (5%).
  23. 23. 8b. Do you expect to see more deals using:Q8b. Do you expect to see more deals using: 42% 58% All cash A mix of cash and stock All stockThe majority of advisors in Greater China believe they will be seeing more deals using allcash (58%), while two in five (42%) believe deals using a mix of cash and stock will be onthe rise. No respondents believe the level of all stock deals will increase in 2013.
  24. 24. 8c. DoDo you expect to see more deals using:Q8c. you expect to see more deals using: 22% 78% All cash A mix of cash and stock All stockNearly four in five (78%) European advisors expect to see more all cash deals in 2013. Theremainder (22%) foresees more deals using a mix of cash and stock.
  25. 25. 9. Compared to 2012, do you think the level of mega-deals andleveraged buyouts will do you think the level of mega-deals andlevel in 9. Compared to 2012, increase, decrease or stay at the same leveraged2013? buyouts will increase, decrease or stay at the same level in 2013? 11% 89% Increase Stay the same Decrease Nearly nine in ten North American advisors (89%) believe 2013 will mark an increase in the level of mega-deals and leveraged buyouts.
  26. 26. 10. Do you expect to see more distressed M&A transactions to takeplace inside of bankruptcymore distressed M&A transactions to take place10. Do you expect to see or outside of bankruptcy? inside of bankruptcy or outside of bankruptcy? 22% 78% Inside of bankruptcy Outside of bankruptcyFour fifths of North American advisors surveyed (78%) believe distressed transactions willtake place outside of bankruptcy rather than during the Chapter 11 process.
  27. 27. 11a. InIn the upcoming year, which of thefollowing buyers do you expect 11. the upcoming year, which of the following buyers do you expect toto be most active in acquiring distressed assets? be most active in acquiring distressed assets? Private equity 49% Strategic buyers 32% Hedge funds 17% Management 2%Half of North American survey respondents (49%) expect to see private equity buyers as themost active in acquiring distressed assets, while a third (32%) see strategic buyers and nearlya fifth (17%) believe hedge funds will enter the mix.
  28. 28. 11b. In the upcoming year, which of the following buyers do you expect Q11b. In the upcoming year, which of the following buyers do you to be most active in acquiring distressed assets? expect to be most active in acquiring distressed assets? Strategic buyers 46% Private equity 29% Hedge funds 8% Management 8% Lenders 8%Greater China advisors expect strategic buyers to lead private equity in terms of buying dis-tressed assets (46% vs. 29% respectively).
  29. 29. Q11c. In the upcoming year, which of the following buyers do you11c. In the upcoming year, in acquiring distressed assets? do you expect expect to be most active which of the following buyers to be most active in acquiring distressed assets? Private equity 50% Strategic buyers 39% Hedge funds 11% Management 0%European advisors predict that distressed assets will go to a mix of private equity (50%) andstrategic buyers (39%).
  30. 30. ABOUT BRUNSWICK GROUP LLCBrunswick Group LLC is a private partnership with a growing team of approximately600 employees, including more than 90 partners around the world. The firm has grownorganically over 25 years and now has 21 wholly owned offices in 12 countries. Theseinclude Abu Dhabi, Beijing, Berlin, Brussels, Dallas, Dubai, Frankfurt, Hong Kong,Johannesburg, London, Milan, Munich, New York, Paris, Rome, San Francisco, Shanghai,Sao Paulo, Stockholm, Vienna and Washington D.C. The firm’s service offer comprisescorporate and financial communications, investor relations, internal communicationsand opinion research.Number one in M&A communications as ranked by Mergermarket for 2012.
  31. 31. ABU DHABI DUBAI MILAN SÃO PAULOBrunswick Gulf Ltd Level 5 Brunswick, Brunswick Group LLC,Suite 602 Gate Village Building 10 Via Solferino 7, Rua Tabapuã 145,Office 607-A PO Box 506691 20121 Milan, Italy 3° andar, sala 39Park Rotana Office Complex Dubai International Itaim BibiTwofour54 Financial Centre t: +39 02 9288 6200 São Paulo 04533-010Po Box 77800, Abu Dhabi, UAE Dubai, UAE f: +39 02 9288 6214 Brazilt: +971 2 401 2690 t: +971 (4) 446 6270 MUNICH t: + 55 11 3296 4086 f: +971 (4) 436 4160 Brunswick Group GmbH,BEIJING Oberföhringer Straße 4 SHANGHAIBrunswick Group, FRANKFURT 81679 München, Germany Office 881, 8/F, Yueda 8892605 Twin Towers (East), Brunswick Group GmbH, CentreB12 Jianguomenwai Avenue, Weißfrauenstraße 12-16, t: +49 89 890 69 120 1111 Changshou RoadBeijing, 100022, China 60311 Frankfurt, Germany Jing’an DistrictShanghai 200042, NEW YORK Chinat: +86 10 6566 2256 t: +49 69 2400 5510 Brunswick Group LLC,f: +86 10 6566 3856 f: +49 69 2400 5555 140 East 45th Street, t: +86 21 2230 1762 30th FloorBERLIN HONG KONG New York, NY 10017, USA STOCKHOLMBrunswick Group GmbH, 12/F Dina House Brunswick GroupTaubenstraße 20-22, 11 Duddell Street, Central t: +1 212 333 3810 (BRNSWK Nordic AB),10117 Berlin, Germany Hong Kong SAR f: +1 212 333 3811 Kungsträdgårdsgatan 16, People’s Republic of China 111 47 Stockholm, Swedent: +49 30 2067 3360 PARISf: +49 30 2067 3366 t: +852 3512 5000 Brunswick, t: +46 8 410 32 180 f: +852 2259 9008 10 boulevard Haussmann, f: +46 8 611 00 56BRUSSELS Paris, 75009,Brunswick Group LLP, JOHANNESBURG France VIENNAAvenue des Arts 27, Brunswick South Africa Ltd, Brunswick Corporate1040 Brussels, Belgium 23 Fricker Road, Illovo t: +33 1 53 96 83 83 Communication GmbH, Boulevard, f: +33 1 53 96 83 96 Rotenturmstrasse 1,t: +32 2 235 6511 Illovo, Johannesburg, Stephansplatz,f: +32 2 235 6522 South Africa ROME 1010 Vienna, Austria Brunswick,DALLAS t: +27 11 502 7300 Piazza del Popolo, 18 t: +43 1 907 65 10Brunswick Group LLC, f: +27 11 268 5747 00187 Rome f: +43 1 907 65 10 40 :200 Crescent Court ItalySuite 225 LONDON WASHINGTON, D.C.Dallas, TX 75201, USA Brunswick Group LLP, t: +39 02 9288 6200 Brunswick Group LLC, 16 Lincoln’s Inn Fields, 1099 New York Avenue, NWt: +214 254 3790 London, WC2A 3ED, SAN FRANCISCO Suite 300f: +214 254 3791 United Kingdom Brunswick Group LLC, Washington, D.C. 20001, USA One Front Street, Suite 1850, t: +44 20 7404 5959 San Francisco, CA 94111, USA t: +1 202 393 7337 f: +44 20 7831 2823 f: +1 202 898 1588 t: +1 415 671 7676 f: +1 415 671 7677
  32. 32. London Brussels Berlin Frankfurt Stockholm Milan Munich BeijingDallas Paris Hong KongNew York Rome ShanghaiSan Francisco ViennaWashington, DC Abu Dhabi DubaiSão Paulo Johannesburg
  33. 33. Abu Dhabi Hong Kong RomeBeijing Johannesburg San FranciscoBerlin London São PauloBrussels Milan ShanghaiDallas/Fort Worth Munich StockholmDubai New York ViennaFrankfurt Paris Washington, D.C.

×