North American M&A Deal Flow Dropped in 3Q17 Despite High Interest From Business Leaders

An overall upbeat outlook on business and M&A in 2017

Business leaders are in full growth mode amid a wide spectrum of viewpoints about the administration in Washington, according to a survey conducted jointly by Harris Williams & Co. and Inc. on over 400 CEOs and senior business leaders of privately held companies.

The survey was conducted immediately after the first 100 days of the Donald Trump presidency. Survey results were released on October 9th.

According to the survey, 95% of respondents showed interest in M&A transactions in 2017, compared to 81% in 2015. A 65% majority said they were interested in acquiring other companies, up significantly from 38% in Harris Williams & Co.’s 2015 study. On the other side of the coin, 52% said they would consider selling all or a portion of their businesses, and 36% would consider a merger.

When it comes to the attitudes towards the Trump administration, 50% of the survey respondents said the new administration will have a positive impact on their business, while 18% believe it would be negative, and 20% of the business leaders expressed uncertainty.

Click here to see the survey result.

North American M&A activities in 3Q17

Zooming in onto the North American M&A space, deal volume and value fell to just 5,293 deals worth a total of USD 338,515 million in 3Q17, according to a Zephyr reports on M&A and private equity activity in Q3 2017 published by Bureau van Dijk, a Moody’s analytics company business providing business intelligence and company information.

US M&A amounted to 4,551 deals worth a combined USD 320,404m in the third quarter, compared to 5,361 deals totaling USD 384,541m in 2Q17. Canadian M&A weakened at an even faster rate than that of US deal making: M&A volume fell by more than a third over the three months to 742 (Q2: 1,128) while value was down by 20% to USD 22,283m (Q2: USD 27,816m), according to the report.

There were 16 private equity and venture capital deals worth USD 1,000m or more in 3Q17. Canada Pension Plan Investment Board (CPPIB) and Softbank of Japan each backed two of these high value deals.

CPPIB in the third quarter joined Energy Capital Partners to bankroll the buyout of Calpine for USD 17,132m. It also took part in a USD 1,000m investment in IMG Worldwide alongside Singaporean sovereign wealth fund GIC.

Softbank and its Vision Fund provided office sharing startup WeWork Companies with a cash infusion of USD 3bn.

Click here to see the top 20 North America private equity deals by value in 3Q17 and more about the report.