M&A market bounces back in 2004

TD Bank Financial Group’s $4.9 billion takeover of Banknorth Group, the biggest transaction of the year; TD Bank Financial Group’s $4.9 billion takeover of Banknorth Group, the biggest transaction of the year; EnCana’s sale of UK assets to Nexen for $2.7 billion and takeover of Tom Brown for $3.6 billion; the proposed merger of Goldcorp […]

By Steven Lamb | February 23, 2005 | Last updated on February 23, 2005

2 min read

TD Bank Financial Group’s $4.9 billion takeover of Banknorth Group, the biggest transaction of the year;

EnCana’s sale of UK assets to Nexen for $2.7 billion and takeover of Tom Brown for $3.6 billion;

the proposed merger of Goldcorp and Wheaton River, worth $2.4 billion, while Gordcorp fought off a takeover by Glamis, valued at $3.7 billion;

Rogers Communications buyout of Rogers Wireless and takeover of Microcell Communications, worth $1.8 billion and $1.4 billion respectively; and

Bain Capital’s $2.0 billion purchase of SuperPages Canada

“With the generally good environment for M&A and the large amounts of private capital available for these transactions, we would expect to see this trend continue,” said Walker.

The mid-market — defined as deals worth between $1 million and $1 billion — also saw robust growth, with the number of deals rising 4.6% to 612 and the value of those transactions soaring more than 42% to $64 billion.

In the fourth quarter, there were 210 transactions announced, valued at $32 billion. This number included seven mega-deals and marked a 57% increase in transaction value from the same quarter in 2003.

Filed by Steven Lamb, Advisor.ca, steven.lamb@advisor.rogers.com

(02/23/05)

Steven Lamb

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TD Bank Financial Group’s $4.9 billion takeover of Banknorth Group, the biggest transaction of the year;
EnCana’s sale of UK assets to Nexen for $2.7 billion and takeover of Tom Brown for $3.6 billion;
the proposed merger of Goldcorp and Wheaton River, worth $2.4 billion, while Gordcorp fought off a takeover by Glamis, valued at $3.7 billion;
Rogers Communications buyout of Rogers Wireless and takeover of Microcell Communications, worth $1.8 billion and $1.4 billion respectively; and
Bain Capital’s $2.0 billion purchase of SuperPages Canada

“With the generally good environment for M&A and the large amounts of private capital available for these transactions, we would expect to see this trend continue,” said Walker.

The mid-market — defined as deals worth between $1 million and $1 billion — also saw robust growth, with the number of deals rising 4.6% to 612 and the value of those transactions soaring more than 42% to $64 billion.

In the fourth quarter, there were 210 transactions announced, valued at $32 billion. This number included seven mega-deals and marked a 57% increase in transaction value from the same quarter in 2003.

Filed by Steven Lamb, Advisor.ca, steven.lamb@advisor.rogers.com

(02/23/05)

(February 23, 2005) The Canadian market for mergers and acquisitions was red hot in 2004, recovering from three consecutive years of decline to hit levels not seen since 2001, according to an annual industry study by investment bank Crosbie & Co.

While the number of transactions only increased by about 3% to 859 deals in 2004, the value of those transactions soared to $115 billion, an increase of 39% from the previous year’s $83 billion.

The increase in value can be attributed to the number of “mega-deals,” which are defined in Canada as those valued in excess of $1 billion. Last year there were 25 such transactions, worth more than $52 billion in total.

“Although the strategic buyer was definitely alive and well in 2004, we also saw increasingly strong activity from private equity firms and other capital groups as buyers,” said Colin Walker, managing director, Crosbie & Co. “They are playing a significant role in a broad range of M&A situations, ranging from public and private company buyouts to restructurings.”

The greatest number of deals were located in the industrial sector, where 205 transactions accounted for $16 billion in value.

Due to continued strength in oil and gas prices, this sector witnessed the most activity by value, totalling $24 billion, an increase of 175% from $9 billion in 2003. The most dramatic increase in total deal value was in the consumer products sector, where total value rose to $13 billion in 2004 from $3 billion in 2003, thanks largely to the successful brewery merger between Molson and Coors, worth $4.5 billion alone.

Such cross-border deals continued to play an important role in the Canadian M&A market, accounting for half of the deals and a whopping 70% of total dollar value. Canadian firms were the acquirors in 312 cross-border deals, nearly triple the number of foreign buyers of Canadian firms. These Canadian purchases totalled $37 billion, an increase of 34% over 2003.

Other notable transactions included:

TD Bank Financial Group’s $4.9 billion takeover of Banknorth Group, the biggest transaction of the year;
EnCana’s sale of UK assets to Nexen for $2.7 billion and takeover of Tom Brown for $3.6 billion;
the proposed merger of Goldcorp and Wheaton River, worth $2.4 billion, while Gordcorp fought off a takeover by Glamis, valued at $3.7 billion;
Rogers Communications buyout of Rogers Wireless and takeover of Microcell Communications, worth $1.8 billion and $1.4 billion respectively; and
Bain Capital’s $2.0 billion purchase of SuperPages Canada

“With the generally good environment for M&A and the large amounts of private capital available for these transactions, we would expect to see this trend continue,” said Walker.

The mid-market — defined as deals worth between $1 million and $1 billion — also saw robust growth, with the number of deals rising 4.6% to 612 and the value of those transactions soaring more than 42% to $64 billion.

In the fourth quarter, there were 210 transactions announced, valued at $32 billion. This number included seven mega-deals and marked a 57% increase in transaction value from the same quarter in 2003.

Filed by Steven Lamb, Advisor.ca, steven.lamb@advisor.rogers.com

(02/23/05)

(February 23, 2005) The Canadian market for mergers and acquisitions was red hot in 2004, recovering from three consecutive years of decline to hit levels not seen since 2001, according to an annual industry study by investment bank Crosbie & Co.

While the number of transactions only increased by about 3% to 859 deals in 2004, the value of those transactions soared to $115 billion, an increase of 39% from the previous year’s $83 billion.

The increase in value can be attributed to the number of “mega-deals,” which are defined in Canada as those valued in excess of $1 billion. Last year there were 25 such transactions, worth more than $52 billion in total.

“Although the strategic buyer was definitely alive and well in 2004, we also saw increasingly strong activity from private equity firms and other capital groups as buyers,” said Colin Walker, managing director, Crosbie & Co. “They are playing a significant role in a broad range of M&A situations, ranging from public and private company buyouts to restructurings.”

The greatest number of deals were located in the industrial sector, where 205 transactions accounted for $16 billion in value.

Due to continued strength in oil and gas prices, this sector witnessed the most activity by value, totalling $24 billion, an increase of 175% from $9 billion in 2003. The most dramatic increase in total deal value was in the consumer products sector, where total value rose to $13 billion in 2004 from $3 billion in 2003, thanks largely to the successful brewery merger between Molson and Coors, worth $4.5 billion alone.

Such cross-border deals continued to play an important role in the Canadian M&A market, accounting for half of the deals and a whopping 70% of total dollar value. Canadian firms were the acquirors in 312 cross-border deals, nearly triple the number of foreign buyers of Canadian firms. These Canadian purchases totalled $37 billion, an increase of 34% over 2003.

Other notable transactions included:

TD Bank Financial Group’s $4.9 billion takeover of Banknorth Group, the biggest transaction of the year;
EnCana’s sale of UK assets to Nexen for $2.7 billion and takeover of Tom Brown for $3.6 billion;
the proposed merger of Goldcorp and Wheaton River, worth $2.4 billion, while Gordcorp fought off a takeover by Glamis, valued at $3.7 billion;
Rogers Communications buyout of Rogers Wireless and takeover of Microcell Communications, worth $1.8 billion and $1.4 billion respectively; and
Bain Capital’s $2.0 billion purchase of SuperPages Canada

“With the generally good environment for M&A and the large amounts of private capital available for these transactions, we would expect to see this trend continue,” said Walker.

The mid-market — defined as deals worth between $1 million and $1 billion — also saw robust growth, with the number of deals rising 4.6% to 612 and the value of those transactions soaring more than 42% to $64 billion.

In the fourth quarter, there were 210 transactions announced, valued at $32 billion. This number included seven mega-deals and marked a 57% increase in transaction value from the same quarter in 2003.

Filed by Steven Lamb, Advisor.ca, steven.lamb@advisor.rogers.com

(02/23/05)

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