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US M&A Remains Strong Amid Global Headwinds According to a New Report by White & Case and Mergermarket

The US M&A market delivered another robust year in 2019, maintaining its year-on-year value and taking a greater share of the overall deal market, while global deal value dropped 8 percent compared to 2018. This is according to a new report: Ahead of the pack: US M&A 2019 by global law firm White & Case LLP and M&A data provider Mergermarket
 
"Thanks to confidence in the US economy and the opportunities it offers companies for growth and investment, nine of the top ten deals for 2019 were domestic, suggesting that US corporate executives see plenty of opportunity in their home market," said John Reiss, Global Head of M&A at White & Case. "However, with a presidential election in H2 as well as ongoing headwinds such as trade wars, and unrest in the Middle East and the coronavirus threat, there is no room for complacency, and dealmakers who take a confident but prudent approach to M&A will be best placed to succeed."

The report notes that US dealmakers had a strong 2019, with 5,757 deals targeting US companies, valued at a total of US$1.53 trillion. While this is a 10 percent decline in volume, value is practically the same as the previous year’s tally, making it the third-highest total on record. US activity was strong domestically due to a number of megadeals (valued at US$5 billion or more), with the life sciences and technology, media and telecommunications (TMT) sectors leading the charge. A full 58 percent of the US$1.5 trillion worth of deals struck involving US companies qualified as megadeals, up from 47 percent in 2018 and nine of the top ten deals for 2019 were domestic. 

Sector highlights include: 

  • US private equity (PE) deals held firm through 2019 with 1,329 buyouts, worth US$208 billion, representing a decline of 9 percent by volume, but just a 4 percent fall by value relative to 2018.
  • The US TMT sector was the leading M&A sector for both volume and value in 2019 with 1,377 deals racking in nearly US$279.7 billion.
  • The US healthcare sector (incorporating pharma, medical and biotech) has seen M&A valued at US$256.5 billion across 645 deals in 2019. This is a decrease of 9 percent by volume, but an increase of 121 percent by value.
  • The US oil and gas sector slowed in 2019, with 190 deals worth US$158 billion, down 38 percent in volume and 45 percent in value, mirroring steep declines in global M&A in the industry.

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