AB InBev’s Blockbuster Deal With SABMiller Places Second as One of the Biggest Mergers & Acquisitions of 2015; Joint Venture to Solidify Dominance in Latin America
This 2015 has been the year of massive mergers and acquisitions, which set a new record at $5.03 trillion. According to Dealogic consultants, the annual total value for this year represented a substantial increase of 37 percent from 2015. While the last quarter of 2015 scored the highest figure for any quarter on record, Yahoo! News reported.
Since 2015 had been a record-setting year for mergers and acquisitions, investors can likely expect the great deal-making will extend to 2016. As a matter of fact, stock market loves these kinds of transactions as it indicates the confidence of the corporate boards and managers while reduces the number of shares in circulation on the market, Investor Place noted.
This 2015's deal activity didn't just surpass the old record, which was $4.6 trillion in 2007, instead it totally smashed it. And unsurprisingly, the United States spearheaded the global mergers and acquisitions, accounting for half the global volume total and seven of the top 10 transactions. While the healthcare and technology industries took the lead in the deal-making charge.
In order to have a glimpse of the mergers and acquisitions scene this 2015, here are the top 5 deals by value, as listed by Dealogic.
1. Pfizer and Allergan
Deal Value: $160 billion
Since the healthcare sector took the lead in the mergers and acquisitions this year, Pfizer and Allergan's merger proved that there is no bigger deal than theirs. Despite an expected decline in Pfizer's revenue, the merger helped generate material growth as Allergan projected to post top-line expansion of nearly 40 percent in 2015, and it is largely attributed to Botox.
2. Anheuser Busch InBev (AB Inbev/BUD) and SABMiller
Deal Value: $117.4 billion
This year's second-largest deal was the merger between the world's largest brewer AB InBev and its closest rival SABMiller in November. The combined companies would have annual revenue of about $64 billion. The acquisition will also have operations in every important global market while solidifying its dominance in Latin America.
3. Royal Dutch Shell and BG Group
Deal Value: $81.5 billion
The third-largest deal was between Royal Dutch Shell and BG Group, highlighted in April. The deal aimed to help Shell improve its waning production through BG's strong position in liquefied natural gas (LNG), which is considered as a cleaner alternative to coal and nuclear energy.
4. Charter Communications and Time Warner Cable
Deal Value: $79.6 billion
The acquisitions between cable companies have made waves this year. While regulatory concerns scurried the initial merger between Comcast and Time Warner Cable, Charter Communications barged in. And aside from TWC, the company also bought Bright House Networks for $10 billion.
5. Dow Chemical and DuPont
Deal Value: $68.6 billion
Considered as the true merger of equals, the companies had capitalizations of about $60 billion. But the real value comes after the deal closes. And the merged companies will be broken up into enterprises that will concentrate on agriculture, chemicals and materials.
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