— Q2 2019
Coming in from the Cold
The global M&A market witnessed a recovery in H1 2019 (especially during Q2) when compared to H2 2018 levels, but fell well short of reaching the year-over-year H1 2018 levels. During H1 2019, transaction value totalled $1.8T, a 17% increase from H2 2018 ($1.5T), but an 11% decrease year-over-year ($2.0T). An uptick in the number of megadeals in Q2 2019 contributed to the recovery, bringing the H1 2019 total to 24 megadeals, compared to 27 megadeals in H1 2018 (which was a record half-year). This recovery was mainly fuelled by domestic M&A, which accounted for 67% of H1 2019 volume compared to an average 61% since 2010, and a strong US M&A market, accounting for 53% of global M&A value, the highest percentage of value on record (Mergermarket).
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About the Packaging recap
The Packaging Recap is a quarterly report focused on selected transactions in the global plastics and packaging industry and includes brief summaries of selected transactions in the market along with the Global Packaging Index which consists of a wide range of publicly traded companies and is used to illustrate enterprise value trends by sector, transaction volumes and sizes.
All company information is sourced from publicly available sources, including company websites and regulatory announcements.
— Q1 2019
A cold start
The start of the year was slow for the global M&A market, which aligns with the last two quarters of 2018. During Q1 2019, transaction value totalled $801.5B, a 15.1% decrease from Q1 2018 ($943.5B). Megadeals (deals over $10B), which historically supported M&A levels, have seen a sharp decrease from 14 in Q1 2018 to 9 in Q1 2019. Political tensions in both Europe and the US as well as a slowing economic environment contributed to the decrease in global M&A market levels.
— Q4 2018
A tale of two halves
The global M&A market witnessed a mixed year in 2018. Transaction value totalled US$3.5T, a 12.1% increase from 2017 (US$3.2T). However, increased protectionism, regulatory hurdles and political tensions resulted in a transaction value decrease of 27.5% between H1 2018 and H2 2018, confirming the deceleration outlined in our Q3 report. Megadeals witnessed an increase from 30 transactions in 2017 to 36 transactions in 2018, albeit with a marked slowdown during the year with 28 deals in H1 2018 compared with 8 deals in H2 2018. Pressure to consolidate and availability of dry powder led to an average transaction value of US$384.8M, second to only 2015’s value (US$400.3M) according to Mergermarket’s record.
— Q3 2018
Transactional Market Deceleration
The global M&A market witnessed a slowdown in Q3 following a strong start to the year with transaction value totalling US$703.2B, a 35.4% decrease from Q2 (US$1.1T), and represented the lowest Q3 transaction value since 2013 (US$656.9B). Continued trade tensions between the US and its trading partners have hindered global M&A activity, particularly cross-border deals. However, the decrease in cross-border M&A resulted in higher domestic consolidation with a year‑to‑date transaction value of US$1.7T, a 30.6% YoY increase. The deceleration of the M&A market momentum impacted the number of mega deals, with only four occurring in the past quarter compared to 28 for H1 2018, bringing the total to 32 year-to-date, two more than the total for 2017.
— Q2 2018
Building on a strong Q1 2018, the global transactional market achieved a solid Q2, pushing global M&A for H1 2018 to its highest post-crisis value on record with US$1.94T (28.3% increase YoY) across 8,560 deals (6.3% increase YoY) according to Mergermarket. Given the rise of protectionism outlined in earlier publications, dealmakers are increasingly sourcing local transactions, making domestic deals the driver for the majority of the growth in global M&A. Moreover, with 26 megadeals (deals over US$10B) for H1 2018, only two shy from the FY2017 total, the market is on track for a strong, if not record year. The availability of cheap financing and technological disruption is driving blockbuster consolidation, explaining the growth in mature geographies with Europe and the US accounting for over 76.2% of global transaction value, up from 64.9% in H1 2017.
— Q1 2018
Fewer but larger deals Globally
The global transactional market witnessed a strong Q1 in 2018, reaching its highest level for a first quarter since 2001. Pressure from shareholders and the search for innovation were the strongest drivers of M&A activity in the quarter, resulting in an increase in total deal value despite a decrease in the volume of transactions when compared to Q1 2017. Global M&A operations reached US$890.7B (3,774 deals) in Q1 2018, an 18% increase from the same period in 2017 in terms of total deal values (US$754.7B, 4,672 deals).
— Q4 2017
Uncertainty with a regional and sector colour
The global transactional market saw a dip in value in 2017 caused by increased political and tax reform uncertainty. The rising tensions in the Middle East, Brexit negotiations, the North Korea situation, and domestic uncertainty in the US around tax reform until very late in the year drove global markets down with respect to the value and volume of transactions. Worldwide M&A operations reached US$3.2T (18,433 deals) in 2017, a 3.2% decrease from 2016 in terms of total deal values (US$3.3T, 18,592 deals).