Mergers and acquisitions were a hot topic for the first few weeks of 2013, but then things got quiet on the dealmaking front.
Thankfully for investors, however, M&A saw a big boom to end Q2 — and that could bode well for the second half of 2013.
Earlier this year, we saw some huge deals take place. Big ones include:
- Warren Buffett and Berkshire Hathaway (BRK.B) bought up consumer staples icon H.J. Heinz for $23 billion.
- Liberty Global (LBTYA), a broadband service provider, announced a $16 billion plan to buy Virgin Media.
- American Airlines parent AMR Corp. (AAMRQ) announced a merger with US Airways (LCC) for $11 billion.
- Comcast (CMCSA) purchased the rest of NBCUniversal from General Electric (GE) for $16.7 billion.
Then things settled down … until a massive Merger Monday to end the second quarter that totaled $15.7 billion in one day — the hottest period since February, when the Buffett-led Heinz buyout hit.
Recent deals right before the end of Q2 included:
- British telecom giant Vodafone (VOD) bought German cable company Kabel Deutschland (KBDHY) for $10.1 billion.
- Tenet Healthcare (THC) purchased Vanguard Health Systems (VHS) for about $1.8 billion and the assumption of $2.5 billion in debt.
- Kohlberg Kravis Roberts (KKR) bid $1.3 billion for PRA International, a provider of medical lab services.
According to M&A data compiled by Mergermarket, this brisk day helped push second-quarter M&A numbers over first-quarter totals — up to $441 billion from $427 billion or so.
Unfortunately, the last-minute additions still leave us down about 9% from last year. At the halfway point in 2012, deals totaled $963 billion or so; now we are at just $868 billion.
But there’s hope — particularly in domestic companies.
“The US is the only region to witness a higher H1 2013 than in H1 2012, up 8.6% to US$ 325.8bn from US$ 299.9bn in the comparative period,” according to Mergermarket.
The dealmaking is also a boon to domestic financials who are big players in the transactions. Data show JPMorgan (JPM) is the No. 1 financial adviser in terms of overall value with almost $160 billion in deals for the first half of the year — more than 18% of the total global haul! Volume-wise, Goldman Sachs (GS) is the leader with 71 total deals transacted.
There’s no telling what mayhem could hit in the second half to disrupt the M&A scene, of course. But this race to make deals at the end of Q2 — even in a very volatile week for the market — could be a bullish sign for deals in the months ahead.
- Could telecom see a huge merger spree that rivals 2006? (Bloomberg)
- Check out the top M&A players of the first half. (Mergermarket)
- Merger Monday — who’s the big winner from this recent surge? (InvestorPlace.com)
Jeff Reeves is the editor of InvestorPlace.com and the author of “The Frugal Investor’s Guide to Finding Great Stocks.” Write him at email@example.com or follow him on Twitter via @JeffReevesIP.