US South

Mergermarket trend report Q1-Q3 2015

Fact file - Q1-Q3 2015 vs. Q1-Q3 2014

Total

$413.8bn

14.8%

Texas

$140.0bn

-16.6%

Oklahoma

$66.1bn

300.5%

Florida

$46.1bn

69.4%

Energy, Mining
& Utilities

$173.1bn

5.6%

US South
Continuing last years enthusiasm, 2015 has turned out to be another
noteworthy year for deal-making around the globe, a trend which can
be seen in the Southern US. The region has accounted for 28.8% of M&A
activity in the greater US with 1,119 deals worth US$ 413.9bn, due largely
to a record-breaking Q3, which itself has accounted for 53% of the Souths
total value so far this year with 364 transactions worth US$ 219.3bn. This
broke the regions previous quarterly record of 430 transactions worth US$
215.5bn from Q4 2014, though by only 1.8%.
The Souths top performing sector by value this year, as in 2014, was
Energy, Mining & Utilities (EMU), which captured 41.8% of the regions
market share. Total deal value rose 5.6% in year-to-date 2015 (YTD 2015)
to US$ 173.1bn across 139 transactions from US$ 164bn across 236
transactions in YTD 2014. Two EMU deals made it into the top five: number
one, Energy Transfer Equitys US$ 55.9bn purchase of Oklahoma-based
Williams Companies, and number three, Energy Transfer Partnerss US$
17.8bn purchase of Texas-based Regency Energy Partners. According to
Mergermarket Intelligence, however, the recent drop in oil prices might
have an effect on private equity exits for firms that have been

Quarterly M&A value

US$ 413.9bn
219.3

124.9

2014

44.3 115.3

2013

59.6 62.8 84.7 59.2

69.7

US$ 576.1bn
215.4

201.0

US$ 266.3bn

42.5 67.7 84.2

87.9
97.4

82.9 79.6 85.3

Industrials & Chemicals

US$ 256.4bn
2010

2009

2008

2007

78.5 65.4 58.0 54.6

US$ 193.1bn
28.5
120.7
6.7
37.1
US$ 190.8bn
99.5 29.5
31.9
29.8

US$ 545.0bn

159.5

122.8 67.9

194.7

0.8

US South trend report Q1-Q3 2015

www.mergermarket.com

Q2

State breakdown

500
450

16.5

Q3

400
350

28.3

According to Mergermarket intelligence,

the
turmoil surrounding the
15.3
Technology
33.9 euro has pushed
Greek economy and the consequentially weakened
investors to be more confident
when
entering 19.7
UK transactions. This year,
Financial
Services
72.7
inbound M&A has reached a record value at 138.6bn, up 118.7% by
Mining
& Utilitiesand overtaking all annual totals on
value compared to theEnergy,
whole
of 2014,
Mergermarket record. France by comparison has recorded 42.4bn-worth
0
50
100
of inbound deals to-date, down 41.7% by value compared
to the same
Deal value (US$bn)
period in 2014 (185 deals, 72.8bn).
2014
2015

Value of deals ($bn)

Q1

Such high valuations over the past year across sectors and regions have
caused concern among deal-makers worldwide that this latest wave of
M&A is a bubble about to burst. However, the final quarter of the year could
be promising for even more M&A for the moment, as deal-makers rush to
close transactions before the anticipated rise in US interest rates. If last year
is to be any guide, with Q4 2014 having seen a rise of 7.2% in total deal
value over Q3 2014s US$ 201bn, Q4 2015 could potentially see a similar
result.

The UK has been central to Europes overall M&ASector

activitybreakdown
so far in 2015,
contributing a 38.7% share to the regions total deal value, up from a 14.5%
during the same period in 2014, and its highest stake on record (since
2001). The 1,004 deals worth 170bn announced to-date have already
overtaken 2014s full value (1401 deals,
89.9 the
Other 94.8bn) by 79.2%, marking
highest annual total since 2007 (1,528 deals, 171.4bn).47.1
Telecommunications

US$ 345.2bn
2011

Copyright Free Vector Maps.com

Deal activity was bolstered by the highest valued H1 period on record

28.8
Business
(136.5bn) whilst deal value
in Services
Q3 dropped19.5
to
33.5bn during the
traditionally slow summer months. Despite showing a 59.7% decrease
11.3
& Biotech
compared to Q2 (325Pharma,
deals,Medical
83.0bn),
Q3 deal 22.9
value increased by 81.6%
compared to Q3 2014 (311 deals, 16.8bn).
30.8

US$ 282.3bn
2012

The South has seen somewhat of a shift in its other top industries. Financial
Services is the regions second-ranked sector so far this year, with 114
transactions worth US$ 72.7bn and recording a 268.2% rise in worth over
the same period last year from US$ 19.7bn. Financial Services topped last
years second-place sector, Industrials & Chemicals, which fell 32.3% to fourth
place with 187 transactions worth US$ 19.5bn. The summer saw a wave of
insurance company consolidations, thus spurring activity in the Financials
Services space. Among these was the second-highest deal for the region,
Aetnas US$ 36.6bn purchase of Kentucky-based Humana. The listed health
benefits company came with an expanding Medicare Advantage division
including chronic care capabilities, which added to Aetnas health insurance
and retirement savings portfolio.

The Souths top-ranking state for M&A was Texas, with 337 transactions worth
US$ 140bn. The Lone Star state also had two top deals: the aforementioned
Energy Transfer Partners/Regency Energy Partners transaction (number
one), and the Netherlands-based NXP Semiconductors nearly US$ 16bn
purchase of Texas-based Freescale Semiconductor (number four). Texas
was 111.6% higher by value than second-ranked Oklahoma, which had 36
deals worth US$ 66.2bn. Though Texas has dominated Southern M&A, the
state also saw a 16.6% drop in value from YTD 2014 to YTD 2015.

Value of deals (US$bn)

2015

heavily invested in upstream companies in the last decade. With such

unattractive projected returns in a slumped market, exits could be on hold
until prices rise.

Q4

300
250
200

150
100
50

164.0
173.1
150

200

2007

2008

Florida

Kentucky

2009

2010

North Carolina

2011

Oklahoma

2012

Texas

2013

Virginia

2014

Rest of the region

YTD 2015

US South
Top deals
Deal
value
(US$m)

Ann.
date

Bidder
company

Bidder
country

Buy-side
advisors

Target
company

Target
sector

Seller
company

Sell-side advisors

55,888

28-Sep

Energy Transfer Equity LP

USA

FA: Bank of America Merrill Lynch;

Citi; Credit Suisse; Deutsche Bank;
Goldman Sachs; Intrepid Partners;
JPMorgan; Morgan Stanley; RBC
Capital Markets; UBS Investment
Bank

Williams Companies Inc

Energy,
Mining &
Utilities

FA: Barclays; Lazard

Financial
Services

LA: Cravath, Swaine & Moore;

Gibson Dunn & Crutcher; Advising
FA: Paul Weiss Rifkind Wharton &
Garrison; Shearman & Sterling

LA: Wachtell, Lipton, Rosen &

Katz; Advising FA: Alston & Bird;
White & Case
36,633

03-Jul

Aetna Inc

USA

FA: Citi; Lazard

Humana Inc

LA: Davis Polk & Wardwell; Jones

Day; Richards Layton & Finger;
Simpson Thacher & Bartlett;
Advising FA: Cleary Gottlieb Steen
& Hamilton; Shearman & Sterling
17,762

26-Jan

Energy Transfer Partners LP

USA

FA: Barclays
LA: Latham & Watkins; Richards
Layton & Finger; Advising
FA: Cleary Gottlieb Steen &
Hamilton

15,972

02-Mar

NXP Semiconductors NV

Netherlands

FA: Credit Suisse

LA: Fried Frank Harris Shriver &

Jacobson; Morris Nichols Arsht
& Tunnell; Skadden Arps Slate
Meagher & Flom; Advising FA:
Gibson Dunn & Crutcher

Copyright Free Vector Maps.com

Regency Energy Partners LP

Freescale Semiconductor Inc

Energy,
Mining &
Utilities

Technology

22-Feb

US South trend report Q1-Q3 2015

www.mergermarket.com

Valeant Pharmaceuticals
International Inc

Canada

FA: Deutsche Bank; HSBC

FA: Citi; JPMorgan

LA: Akin Gump Strauss Hauer &
Feld; Baker Botts; Weil Gotshal
& Manges; Advising FA: Simpson
Thacher & Bartlett

LA: De Brauw Blackstone

Westbroek; Simpson Thacher &
Bartlett; Advising FA: Davis Polk &
Wardwell; White & Case
15,464

FA: Goldman Sachs

FA: Morgan Stanley

LA: Houthoff Buruma; Skadden
Arps Slate Meagher & Flom;
Advising FA: Wilson Sonsini
Goodrich & Rosati PC

Salix Pharmaceuticals Ltd

LA: Osler, Hoskin & Harcourt;

Skadden Arps Slate Meagher &
Flom; Sullivan & Cromwell

Pharma,
Medical
& Biotech

FA: Centerview Partners;

JPMorgan
LA: Cadwalader, Wickersham &
Taft; Covington & Burling; Advising
FA: Debevoise & Plimpton; Willkie
Farr & Gallagher

US South
Financial advisor league table by value
Ranking

Company name

Q1-Q3 Q1-Q3
2015 2014
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15

2
5
3
11
4
6
7
1
10
13
12
9
16
27

Goldman Sachs
JPMorgan
Citi
Credit Suisse
Lazard
Bank of America Merrill Lynch
Morgan Stanley
Barclays
Deutsche Bank
RBC Capital Markets
UBS Investment Bank
Intrepid Partners
Centerview Partners
Evercore Partners
Greenhill & Co

Financial advisor league table by deal count

Q1-Q3 2015

Ranking

Value
(US$m)

Deal
count

% Value
change

229,540
206,595
201,885
175,908
148,785
143,940
141,853
135,538
112,245
77,041
71,972
55,888
35,273
34,318
28,539

63
46
32
41
34
48
44
38
34
24
14
1
8
40
11

18.2%
46.2%
5.4%
262.0%
-6.7%
23.9%
49.7%
-31.9%
128.7%
96.1%
63.0%
-31.1%
34.8%
438.5%

Q1-Q3 Q1-Q3
2015 2014
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15

Legal advisor league table by value

Ranking

Company name

Q1-Q3 Q1-Q3
2015 2014
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15

13
27
5
6
17
9
3
18
14
51
4
26
7
2
20

Skadden Arps Slate Meagher & Flom

Gibson Dunn & Crutcher
White & Case
Simpson Thacher & Bartlett
Cravath, Swaine & Moore
Shearman & Sterling
Cleary Gottlieb Steen & Hamilton
Wachtell, Lipton, Rosen & Katz
Davis Polk & Wardwell
Alston & Bird
Sullivan & Cromwell
Fried Frank Harris Shriver & Jacobson
Baker Botts
Jones Day
Paul Weiss Rifkind Wharton & Garrison

US South trend report Q1-Q3 2015

www.mergermarket.com

Company name

1
10
3
4
11
9
2
8
14
6
17
5
15
7
19

Goldman Sachs
Bank of America Merrill Lynch
JPMorgan
Morgan Stanley
Credit Suisse
Evercore Partners
Barclays
Houlihan Lokey
Raymond James & Associates
Lazard
Deutsche Bank
Citi
Jefferies
RBC Capital Markets
Sandler O'Neill & Partners

Q1-Q3 2015
Value
(US$m)

Deal
count

Count
change

229,540
143,940
206,595
141,853
175,908
34,318
135,538
17,586
1,555
148,785
112,245
201,885
10,258
77,041
3,772

63
48
46
44
41
40
38
38
35
34
34
32
31
24
24

-5
11
-10
-10
5
2
-24
-2
4
-8
7
-20
1
-17
0

Legal advisor league table by deal count

Q1-Q3 2015

Ranking

Value
(US$m)

Deal
count

% Value
change

215,473
162,815
139,873
132,792
125,541
118,748
112,743
110,382
107,000
104,076
100,466
83,575
78,957
77,198
76,736

55
20
50
26
19
17
26
35
29
27
31
25
35
78
29

186.4%
561.4%
-3.4%
1.3%
94.5%
22.9%
-38.4%
107.7%
55.2%
1,068%
-33.6%
230.9%
-33.9%
-60.3%
83.5%

Company name

Q1-Q3 Q1-Q3
2015 2014
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15

1
2
3
8
4
7
28
14
43
9
10
29
11
5
17

Kirkland & Ellis

Jones Day
Latham & Watkins
Skadden Arps Slate Meagher & Flom
DLA Piper
White & Case
King & Spalding
Haynes and Boone
Goodwin Procter
Morgan Lewis & Bockius
Norton Rose Fulbright
Wachtell, Lipton, Rosen & Katz
Baker Botts
Vinson & Elkins
Greenberg Traurig

Q1-Q3 2015
Value
(US$m)

Deal
count

Count
change

70,833
77,198
60,138
215,473
4,311
139,873
20,706
3,031
5,561
18,936
14,531
110,382
78,957
32,338
13,917

110
78
70
55
52
50
47
41
37
36
36
35
35
33
33

-5
-9
-16
10
-27
1
19
5
15
-9
-4
8
-3
-42
0

US South
Trend report criteria

Production contacts

All data is based on transactions over US$ 5m and is based on Mergermarkets M&A deals database.
Deals with undisclosed deal values are included where the targets turnover exceeds US$10m.
Deals where the stake acquired is less than 30% will only be included if the value is greater than US$100m.

Analyst:
Elizabeth Lim
T: +1 212 686 3016

Global research editor:

Kirsty Wilson
T: +44 20 3741 1281

All values are in US$.

PR contacts

M&A trend: Based on the dominant geography of the target company being South.
All trend data excludes lapsed and withdrawn bids.

Americas:
Chrissy Carney
T: +1 646 378 3118

Top deals: Based on the dominant geography of the target company being South.
FA refers to financial advisor and LA refers to legal advisor. Excludes lapsed and withdrawn bids.

EMEA:
Flora Wilke
T: +44 20 3741 1124

Asia:
Ajay Narang
T: +852 2158 9764

EMEA:
Ben Rumble
T: +44 3741 1007

Commercial contacts
Americas:
Kurt Viehl
T: +1 212 390 7812

Industry analysis: Based on the dominant sector and geography of the target company.
Excludes lapsed and withdrawn bids.
League tables: Based on the dominant geography of the target, bidder or seller company being South.
Financial advisor tables exclude lapsed and withdrawn bids.
Legal advisor tables include lapsed and withdrawn bids.

Deal submission contacts

About Mergermarket
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Mergermarket is part of The Mergermarket Group which has nearly 1000 employees worldwide and regional head
offices in New York, London and Hong Kong.
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With an unrivalled network of analysts covering M&A in the Americas, Europe, Middle-East, Africa and Asia-Pacific,
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This wealth of intelligence, together with a series of deal databases, individual and house league tables, profiles and
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apparent when you see that Mergermarket is used by over 1,500 of the worlds foremost advisory firms to assist in their
origination process.

US South trend report Q1-Q3 2015

www.mergermarket.com

Asia:
Elizabeth Chu
T: +852 2158 9706

USA:
Diana Isaacs
T: +1 646 378 3149

Canada:
Jason Loria
T: +1 646 378 3122

C&S America:
Lissa Campos
T: +1 212 686 6521

Asia-Pacific:
John Capulong
T: +852 2158 9723

Japan:
Morly Sun
T: + 852 2158 9708

China:
Rachel Shao
T: +852 2158 9794

EMEA financial advisors:

Andrea Putaturo
T: +44 20 3741 1274

EMEA legal advisors:

Zaynab Dost
T: +44 20 3741 1294

South Korea:
Jade Lee
T: +822 772 8410