Australian M&A deals down in 2016

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by Mark Abernethy

The Australian M&A market was topped by Freehills and Mallesons in 2016, as overall activity dropped by 8.8 per cent despite large M&A deals such as Asciano and Esanda finance.

A total 436 deals amounting to AU$ 85.3 billion were announced in 2016, compared to 2015 when 513 deals were announced, valued at AU$ 93.5b, according to MergerMarket.

The Australian legal adviser M&A league table for 2016, by value, was topped by Herbert Smith Freehills ($62.8b) followed by Allens ($61 bn), King & Wood Mallesons ($53 bn), Gilbert + Tobin ($37.8b) and Osler, Hoskin & Harcourt with $29.9 billion.

MergerMarket’s legal adviser table, by deal number, was topped by King & Wood Mallesons with 67 deals in 2016, followed by Herbert Smith Freehills (66), Allens (41), Minter Ellison (41) and Norton Rose Fulbright with 41 deals in 2016.

MergerMarket’s top five financial advisers by value in 2016 were Macquarie Group ($48.3b), JPMorgan ($40.4b), UBS Investment Bank ($38.4b), Credit Suisse ($33.6b) and Goldman Sachs with $29b.

Australia’s largest M&A deal in 2016, according to MergerMarket was the AU$12.6b Canadian bid for Asciano, which saw law firms Allens, Freshelds Bruckhaus Deringer, Gilbert + Tobin, Herbert Smith Freehills, Johnson Winter & Slattery, Jones Day and Torys advising.

The AU$10.2b TransGrid deal was advised by Gilbert + Tobin, Herbert Smith Freehills and Norton Rose Fulbright, and the AU$8.2b bid by Macquarie Bank for Esanda Finance Corporation was advised by Clayton Utz.

MergerMarket noted that while overall activity was lower than in 2015, Australian outbound deals increased by 20 per cent on the year before. “Australia’s outbound activity increased to AU$ 26.4b with 111 deals announced in FY 2016, hitting its highest value since FY 2008.

“Europe has become the most attractive destination (AU$ 13.4b, 26 deals), with half of the total outbound deal value being invested there. Financial services in Europe was the hottest sector for outbound investors.”

For inbound deals, MergerMarket says North America’s investment into Australia has grown at an unprecedented pace during FY16, reaching a historical high in terms of both value (AU$ 32.4b) and deal count (71 deals), almost tripling the deal value recorded in FY15 (11.3b, 67 deals).