US-South trend report

Q1 2015

Mergermarket Regional Trend Report: US West, Q1 2015

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US-South trend report, Q1 2015

Overview

M&A trend
600

M&A activity in the South had a strong start to the year with 325
deals worth US$ 114.7bn in Q1 2015, which constituted a 33.6%
share of the total US M&A value and represented a massive 158.6%
increase from US$ 44.3bn-worth of deals in Q1 2014.

67.9
500

115.4

121.9

Texas historically the strongest M&A player in the South saw 103
deals valued at US$ 40.8bn in Q1 2015, claiming a 35.6% share of the
regions value. The share actually decreased from 46.1% in Q1 2014,
despite the fact Texas almost doubled its value from US$ 20.4bn.

400

Value of deals (US$bn)

193.0

The two states that stood out this quarter, however, were North
Carolina and Virginia, both of which were home to some of the
top deals. North Carolina, for example, jumped from only US$
716m-worth of deals in Q1 2014 to US$ 20.5bn in Q1 2015, while
maintaining the same number of deals. The bulk of the value
came from the acquisition of Salix Pharmaceuticals by Valeant
Pharmaceuticals for US$ 14.5bn and actually saw the states value
already almost half the value seen during the whole of 2014.

97.2

300

200

29.3

120.6

83.9

0
2007

82.9
114.7
61.8

67.7

154.4
37.1
31.9

28.5
6.7

2008

2009

Q1

Industry analysis

58.2

65.3

99.4

100

67.2

85.0

79.6

29.6

At the same time, Virginia also had a strong quarter largely due to
a US$ 9.6bn merger of MeadWestvaco Corporation and Rock-Tenn

201.0

87.7
54.5

78.4

82.5

2010

2011

Q2

114.7

42.5
2012

Q3

59.5
2013

44.3
2014

2015

Q4

2015

Company, the fifth largest Q1 deal in the South and the highestvalued transaction in the state since the US$ 25.1bn acquisition of
Hilton Worldwide by Blackstone Group in 2007. Both MeadWestvaco
and Rock-Tenn are packaging manufacturers in the Industrials &
Chemicals sector that together aim to expand their reach in the
global consumer and corrugated packaging market. This mega-deal
accounted for 66.4% of the total Industrials & Chemicals deal value
(US$ 14.5bn) in the South in the first quarter.

Q1 2015
17.9%

Q1 2014

6.5%

27.5%

24.9%

10.8%
12.6%

9.7%

23.7%

8.0%

Like Industrials & Chemicals, the Energy, Mining & Utilities sector
also showed solid results, tripling in value from US$ 9bn last year to
US$ 27.8bn in Q1 2015 and slightly increasing its market share from
20.3% to 24.3%.

20.3%
13.9%
24.3%

TMT

Energy, Mining & Utilities

Pharma, Medical & Biotech

Industrials & Chemicals

Consumer

The US$ 18bn acquisition of Texas-based Regency Energy Partners,

a midstream company, by Energy Transfer Partners was the top
deal in the South in Q1 and the third top deal in North America for
the quarter. This deal seems to represent an increased focus on the
midstream sector this year: according to Mergermarket intelligence,
70%
midstream companies are particularly
attractive because they are more shielded
60%
from commodity price volatility than the
upstream sector. In fact, 13 of the top 15
50%
Southern deals in the Energy space involved
midstream targets.

Share in US M&A value

250

Value of deals (US$bn)

200

150

40%

30%

100

20%

50
10%

0%

Q
1

Q
2

Q
3

2007

Q
4

Q
1

Q
2

Q
3

2008

Q
4

Q
1

Q
2

Q
3

2009

Q
4

Q
1

Q
2

Q
3

Q
4

Q
1

2010
Share in US M&A

Mergermarket Regional Trend Report: US-South, Q1 2015

Q
2

Q
3

2011

Q
4

Q
1

Q
2

Q
3

2012

Q
4

Q
1

Q
2

Q
3

Q
4

Q
1

2013

Q
2

Q
3

2014

Q
4

Q
1
2015

Percentage share in US M&A value

Other

One of such deals was the acquisition

of Moda Midstream by EnCap Flatrock
Midstream, an energy-focused private
equity firm, for US$ 750m.
Overall private equity space in the South has
suffered, losing 60% of its deal value and
28.4% of its deal count since Q1 2014 with
58 buyouts valued at US$ 4.8bn in Q1 2015.

Values

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US-South trend report, Q1 2015

Top deals
Value
(US$m)
17,762

Deal details
Announcement date: 26-Jan-2015

Advisory details
FA to sell-side: Citi; JPMorgan
LA to sell-side: Akin Gump Strauss Hauer & Feld; Baker Botts; Advising FA:

Target: Regency Energy Partners LP

Simpson Thacher & Bartlett

Bidder: Energy Transfer Partners LP

FA to buy-side: Barclays
LA to buy-side: Latham & Watkins; Richards Layton & Finger; Advising FA:
Cleary Gottlieb Steen & Hamilton

15,972

Announcement date: 02-Mar-2015

FA to sell-side: Morgan Stanley

LA to sell-side: Houthoff Buruma; Skadden Arps Slate Meagher & Flom;

Target: Freescale Semiconductor Inc

Advising FA: Wilson Sonsini Goodrich & Rosati

Bidder: NXP Semiconductors NV

FA to buy-side: Credit Suisse

LA to buy-side: De Brauw Blackstone Westbroek; Simpson Thacher &
Bartlett; Advising FA: White & Case

14,500

Announcement date: 22-Feb-2015

FA to sell-side: Centerview Partners; JPMorgan

LA to sell-side: Cadwalader, Wickersham & Taft; Covington & Burling;

Target: Salix Pharmaceuticals Ltd

Advising FA: Debevoise & Plimpton; Willkie Farr & Gallagher

Bidder: Valeant Pharmaceuticals International Inc

FA to buy-side: Deutsche Bank; HSBC

LA to buy-side: Osler, Hoskin & Harcourt; Skadden Arps Slate Meagher &
Flom; Sullivan & Cromwell

10,540

Announcement date: 05-Feb-2015

FA to sell-side: Credit Suisse; Guggenheim Partners; PJT Partners

LA to sell-side: Debevoise & Plimpton

Target: GTE Southwest Incorporated; Verizon Florida LLC;

and Verizon California Inc

FA to buy-side: Greenhill & Co; JPMorgan; Lazard

LA to buy-side: Skadden Arps Slate Meagher & Flom; Advising FA: Simpson

Bidder: Frontier Communications

Thacher & Bartle

Seller: Verizon Communications Inc

9,635

Announcement date: 26-Jan-2015

FA to sell-side: Bank of America Merrill Lynch; Goldman Sachs; Greenhill &

Co

Target: MeadWestvaco Corporation

LA to sell-side: Baker Botts; Wachtell, Lipton, Rosen & Katz; Advising FA:
Skadden Arps Slate Meagher & Flom; Sullivan & Cromwell

Bidder: Rock-Tenn Company

FA to buy-side: Blackstone Group; Lazard
LA to buy-side: Cravath, Swaine & Moore; ; King & Spalding; Advising FA:
Gibson Dunn & Crutcher; Greenberg Traurig

Mergermarket Regional Trend Report: US-South, Q1 2015

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US-South trend report, Q1 2015

Financial advisor league table by deal value
Ranking
Q1
2015

Q1
2014

2
3
4
5
6
7
8
9
10

8
3
6
2
5
4
40
17
21

Q1 2015
Value
Deal
count
(US$m)

% Value
change

JPMorgan

56,876

15

138.8%

Credit Suisse
Barclays
Morgan Stanley
Goldman Sachs
Citi
Bank of America Merrill Lynch
Greenhill & Co
Lazard
Centerview Partners

33,010
31,823
30,350
29,593
28,132
24,418
23,199
21,601
18,537

7
9
9
20
6
13
4
10
4

232.3%
61.7%
152.6%
26.4%
114.2%
51.6%
3,409.7%
639.3%
751.9%

Company Name

Financial advisor league table by deal count

Ranking
Q1
2015

Q1
2014

Q1 2015
Value
Deal
count
(US$m)

Company Name

Count
change

Goldman Sachs

29,593

20

-3

2
3
4
5
6
7
8
9
10

2
6
4
7
26
8
3
5
10

JPMorgan
Bank of America Merrill Lynch
Houlihan Lokey
Lazard
Sandler O'Neill & Partners
Raymond James & Associates
Barclays
Morgan Stanley
Simmons & Company International

56,876
24,418
405
21,601
1,293
374
31,823
30,350
2,178

15
13
11
10
10
10
9
9
9

1
1
-3
-2
5
-2
-5
-4
-1

Legal advisor league table by deal value

Ranking
Q1
2015

Q1
2014

2
3
4
5
6
7
8
9
10

7
41
1
34
40
19
3
99
15

Q1 2015
Value
Deal
count
(US$m)

% Value
change

Skadden Arps Slate Meagher & Flom

61,587

15

270.8%

Simpson Thacher & Bartlett

Sullivan & Cromwell
Latham & Watkins
Baker Botts
Cleary Gottlieb Steen & Hamilton
Debevoise & Plimpton
White & Case
Akin Gump Strauss Hauer & Feld
Richards Layton & Finger

56,152
34,544
33,913
31,427
29,357
25,245
19,788
18,921
18,897

10
9
18
16
9
9
6
7
3

445.4%
1,188.6%
46.1%
863.7%
901.3%
274.0%
21.7%
3,101.5%
142.9%

Company Name

Legal advisor league table by deal count

Ranking
Q1
2015

Q1
2014

Q1 2015
Value
Deal
count
(US$m)

Company Name

Count
change

Jones Day

14,666

28

10

2
3
4
5
6
7
8
9
10

2
1
15
6
4
34
3
20
10

Latham & Watkins

Kirkland & Ellis
Baker Botts
Skadden Arps Slate Meagher & Flom
Vinson & Elkins
Cooley
DLA Piper
Haynes and Boone
Simpson Thacher & Bartlett

33,913
8,582
31,427
61,587
8,674
1,023
124
123
56,152

18
18
16
15
13
13
13
11
10

-9
-17
4
-1
-6
5
-8
0
-3

Mergermarket Regional Trend Report: US-South, Q1 2015

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US-South trend report, Q1 2015

Mergermarket criteria
League tables: Based on the dominant geography of the target, bidder
or seller company being US-South. The financial advisor tables exclude
lapsed and withdrawn bids and the legal advisor tables include lapsed and
withdrawn bids.

All data is based on transactions over US$ 5m and is based on the

Mergermarkets M&A deals database. Deals with undisclosed deal values are
included where the targets turnover exceeds US$ 10m.
Deals where the stake acquired is less than 30% will only be included if the
value is greater than US$ 100m. Click here for the full deal criteria.

All values are in US$.

M&A trend: Based on the dominant geography of the target company being
US-South. Excludes lapsed and withdrawn bids.

Data correct as of 14-Apr-2015.

Top deals: Based on the dominant geography of the target company

being US-South. FA refers to financial advisor and LA refers to legal advisor.
Excludes lapsed and withdrawn bids.
Industry analysis: Based on the dominant geography of the target company
being US-South. Industry sectors represent the primary industry sector of
the target company only. Excludes lapsed and withdrawn bids.

Contacts

PR
Chrissy Carney
T: +1 646 378 3118

Deal submissions

Research

Diana Isaacs
T: +1 646 378 3149

Analyst
Nicole Corazza
+1 212 646 378 3153

Commercial
Kurt Viehl
T: +1 212 390 7812

Global research editor

Kirsty Wilson
+44 207 010 6271

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Mergermarket Regional Trend Report: US-South, Q1 2015

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