Our thinking

Navigating change: US M&A H1 2018

What's inside

Clouds are forming on the horizon, however appetites for big-ticket deals have not yet diminished

US M&A defies market uncertainty

An impressive first half of the year for US dealmaking reflects M&A's enduring value in an uncertain market

After a very strong 2017—when M&A in the US reached its third-highest overall deal value since the financial crisis—deal value grew again in the first half of 2018. Compared to H1 2017, value rose 30.5 percent to US$794.8 billion when compared to the same period in 2017, while deal volumes held steady.

Activity has been brisk despite increasing macro-economic headwinds. The Federal Reserve recently raised interest rates and signaled its intention to do so again twice more before the year is out. Threats of a bourgeoning global trade war are intensifying after the imposition of tariffs by the US and other large economies. And the US stock market has experienced significantly higher volatility this year than it did last.

One could reasonably expect that M&A would cool against this backdrop, but the fact that it has not suggests that deals are going ahead for essential strategic reasons rather than opportunistic ones.

Technology and its disruptive impact across all sectors is one of the main factors that has made M&A a necessity. The impact has been most apparent in sectors such as retail and healthcare, where digital platforms are ideally placed to disrupt established service and distribution channels. No sector has been untouched, however. Unless non-tech companies have the resources in-house to write their own software and algorithms—and most do not—M&A may be the best option to keep pace with dynamic change.

We expect the second half of the year to be busy, but no one can afford to ignore the threats posed by rising interest rates, increasing protectionism, an incipient trade war that could increase tariffs, a potentially inverting yield curve, unsustainable pricing demands and a volatile stock market. Companies will need to navigate these dynamics if M&A's bull run is to continue.


John Reiss
Global Head of M&A
White & Case

Gregory Pryor
Head of Americas M&A
White & Case


Navigating change: H1 in review

First-half activity remains on par with 2016, as strong fundamentals continue to drive M&A

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PE hits new post-crisis high

Despite intensifying competition within the market, US private equity activity is yet to show signs of a downturn

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Sector watch

Energy, mining & utilities leads the field

Bulky oil & gas deals pushed energy, mining & utilities close to the top spot in H1, while digital disruption ensured a steady flow of tech deals

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Technology M&A gets white hot in 2018

Dealmakers across all industries are looking to secure US tech assets in order to keep up with the technological changes disrupting their industries

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Consumer firms adapt to survive

Despite a drop in headline figures, M&A within the US consumer sector remains an important method to secure long-term growth

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Oil & gas M&A gains cautious ground

A steadying oil price signals a brighter future for oil & gas M&A, yet market caution remains

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Big-ticket deals drive pharma M&A

Activity in the sector is fueled by the need to refill product pipelines and navigate convergence between health and tech firms


Industrials & chemicals M&A gathers pace

Corporate repositioning and tax reform are two key trends driving M&A in the sector


Is blockchain M&A poised to accelerate?

US dealmakers are learning to navigate the complex world of blockchain M&A, but they will have to proceed with care in heavily regulated sectors

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In focus: Financial services regulation

An overview of the financial regulatory landscape and key trends to watch

US dollar

Decision time for M&A in Delaware

Noteworthy rulings out of the Delaware Supreme Court and the Court of Chancery in the past six months are already having consequences for M&A activity

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Spotlight on public companies: Cybersecurity and governance

The number and severity of cybersecurity incidents at major companies has increased, causing regulators to take a tougher approach. We look at five practical steps companies can take to manage these risks

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Key trends to watch in the months ahead

Acquirers shrugged off macro-economic uncertainty in the first half of the year to secure deals of strategic necessity

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Meet our partners

Global M&A leaders

John Reiss


John Reiss
Partner, New York


Gregory Pryor


Gregory Pryor
Partner, New York


 Dr. Jörg Kraffel

Dr. Jörg Kraffel
Partner, Berlin


Christopher Kelly


Christopher Kelly
Partner, Hong Kong


Allan Taylor


Allan Taylor
Partner, London


 Barrye Wall


Barrye Wall
Partner, Singapore


John Cunningham

John Cunningham
Partner, London


Alexandre Ippolito

Alexandre Ippolito
Partner, Paris


Technology M&A gets white hot in 2018

Dealmakers across all industries are looking to secure US tech assets in order to keep up with the technological changes disrupting their industries

3 min read

It has been a busy period for the tech sector, with 483 deals in the first half of 2018. And value rose to US$67.4 billion in H1, a 59 percent increase compared to H1 2017.

It has become a necessity for companies to either build or buy tech capabilities to stay relevant, regardless of their industry. If companies do not have the ability or experience to build a tech solution in-house—and most non-tech companies do not—then the M&A route may be their best option.


Top tech deals
H1 2018

1: Microchip Technology Inc. bought Microsemi Corporation for US$9.8 billion

2: Microsoft Corporation agreed to buy GitHub Inc. for US$7.5 billion

3: Saleforce.com Inc. bought MuleSoft Inc. for US$5.9 billion


Connected healthcare

Healthcare has experienced a high level of disruption from tech company challengers. Personally connected devices can help monitor personal data, which tech-enabled healthcare companies can aggregate and mine to improve product distribution and even clinical determinations. This leaves the healthcare industry ripe for further digital disruption.


US$67.4 billion

The value of 483 deals targeting the US tech sector in H1 2018

Pure play here to stay

M&A between tech firms has also remained strong, as firms look to consolidate in order to cut costs and stay ahead of competition. Salesforce, for example, has agreed to pay US$5.9 billion for MuleSoft, a platform that allows clients to integrate data from the cloud and in-house servers, in what will be its biggest deal ever conducted. And Microsoft agreed to pay US$7.5 billion for code-sharing platform GitHub.


CFIUS caution

Chinese dealmaking into the US tech sector has been dampened by heightened scrutiny from CFIUS. The value of cross-border TMT deals from China into the US dropped from US$11.6 billion in 2016 to just US$2.25 billion last year.

It may be no coincidence that Chinese firms are developing more technological expertise in-country as well as increasingly targeting Asian neighbors Japan, Korea and Taiwan for their tech assets.

However, the announcement that CFIUS had approved investment company China Oceanwide Holding's purchase of insurer Genworth Financial in June perhaps signals a softening of the committee's stance. The deal was first announced in 2016 and both companies had to agree to take special measures to protect customer data in order to get approval. While this may be a one-off, it does show that cross-border deals from China deals can get across the line.



Percentage increase in tech M&A value compared to H1 2017

GDPR roadblocks

Now that the General Data Protection Regulation (GDPR) has come into effect in Europe, there is increased talk of similar regulations being proposed in the US, even for companies without a European connection. This may result in some tech giants becoming more internally focused on compliance, rather than outwardly focused on growth.

Yet, despite potential headwinds, corporate demand for tech M&A is expected to rise. As many potential tech acquirers are now loaded with cash, continued improvement in market confidence could drive deal sizes skyward in future quarters.



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