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U.S. M&A In Europe Sees A Strong Rise In 2016

A strong U.S. dollar, escalating interest rates, and worries about international trade barriers did little to dissuade U.S. buyers from embarking on a hearty pace of European acquisitions last year. According to S&P Global Market Intelligence data, announced M&A transactions during 2016 involving U.S.-based buyers or investors in Europe reached $202.5 billion, a 33% jump from the prior year’s total of $151.7 billion. Furthermore, 2016’s results marked the second-best year for U.S. M&A in Europe, based on aggregate dollar proceeds, with only 2007’s total of $217 billion coming in higher.

Contributing to the results were two major deals announced in the final quarter of 2016. First, California-headquartered QUALCOMM Incorporated (NasdaqGS:QCOM) entered into a definitive agreement to acquire Netherlands-based NXP Semiconductors NV (NasdaqGS:NXPI) in a transaction valued, with assumed liabilities, at $47.6 billion on October 27, 2016. The deal ranks as QUALCOMM’s largest-ever acquisition and the second-largest ever worldwide M&A deal in the information technology sector. Also, Connecticut-based Praxair, Inc. (NYSE:PX) offered  to acquire German industrial gas company Linde Aktiengesellschaft (DB:LIN) on November 29, 2016.  For Praxair, the deal ranks as the company’s largest ever acquisition and is also the fifth-largest ever announced worldwide materials sector M&A deal.

Among specific sectors, information technology ranked first for U.S. M&A in Europe during 2016, with a total of $62.1 billion in disclosed deals, up 133% from 2015’s total of $26.6 billion.  Materials followed with $50 billion in announced U.S. acquisitions in Europe, compared to $18 billion in deals in 2015. The consumer discretionary sector came in third place last year with regard to U.S. deal making in Europe with $35 billion, compared to $12 billon in transactions in 2015.  On the other hand, several sectors saw a significant retreat in deal activity last year. Financial sector M&A involving U.S. purchases in Europe slid almost 79% as $6.4 billion in deals took place, compared to $30 billion in 2015. Telecommunication services deal volume dropped over 96% as under $27 million in transactions occurred last year, versus over $876 million in 2015. 

Announced U.S. Acquisitions in Europe

Transaction Screening Aggregates

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