A mergermArket report on globAl m&A Activity
Monthly M&A InsIder
December 2009 AmericAS
CONTENTS
introDUction 3
nortH AmericAn m&A 4
rUSSiAn bAnking Sector: SoUrceS ScepticAl AboUt
conSoliDAtion proSpectiveS 6
tele2 continUeS mArcH eAStWArDS DeSpite recent
‘interStellAr’ SetbAck 8
nortH AmericA 10
lAtin AmericA 24
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Monthly M&A InsIder
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INTrOduCTION
03
Abu dHAbI’S CHrISTMAS prESENT TO
dubAI WOrld
Encouragingly, there was a rise in deal valuations in November payments on $26bn in debt held by state-owned conglomerate
compared to the preceding month in the uK, with the combined dubai World. This panic has been eased considerably by oil
value of all M&A transactions for the fourth quarter already up rich Abu dhabi’s sovereign wealth fund, who agreed to inject
to €22.6bn, compared to a combined value for all M&A in the $10bn to aid it’s more ostentatious neighbour which slid close
uK of €10.8bn the quarter before. to default following issues stemming from property developer
Nakheel, which is owned by dubai World. However, the debate
Similarly in North America, Q4 09 is signalling a slight
rages on as to the damage done to dubai’s reputation, while
turnaround in deal valuations, with the last quarter’s total
the remaining $22bn in debts still remains outstanding.
already exceeding Q3 aggregated investments by $5bn. This
has primarily been driven by a raft of mega-deals of late, such mergermarket are pleased to offer you the december edition
as the recent announcement that ExxonMobil Corporation will of Monthly M&A Insider, a publication which provides you with
acquire XTO Energy Inc for uS$40.4bn. features by mergermarket journalists, deals of the month,
potential activity and deal drivers. We hope you continue to find
And although both regions will continue to face difficulties in
it useful.
2010, it is dubai which is stealing the headlines this month.
By Anna henderson, remark
Three weeks of market turmoil followed after dubai froze
head of research – Elias latsis north America – Yasmin Salfati
latin America – Jennifer ruiz
editor – Anna Henderson
For advertising opportunities contact:
erik Wickman
tel: 001 212 6863329
erik.wickman@mergermarket.com
Monthly M&A report
INTrOduCTION /
NOrTH AMErICAN M&A
04
A revIeW of the yeAr’s leAdIng sectors: IN THE FIrST HAlF OF 2009, THrEE SECTOrS TOppEd THE
CHArTS IN TErMS OF AGGrEGATE M&A dEAl vAluE: HEAlTHCArE ANd lIFE SCIENCES, WITH 118 dEAlS
WOrTH uS$165bN; FINANCIAl SErvICES, WITH 172 dEAlS WOrTH uS$68.5bN; ANd ENErGY, WITH 104 dEAlS
WOrTH uS$52.3bN. THE SECONd HAlF OF THE YEAr IS COMING TO A ClOSE WITH SIGNIFICANTlY lOWEr
dEAl vAluES IN THESE SECTOrS, WITH THE EXCEpTION OF ENErGY, WHICH rECEIvEd A MAJOr bOOST IN
MId-dECEMbEr THANKS TO EXXONMObIl COrpOrATION’S uS$40.4bN ACQuISITION OF XTO ENErGY INC.
Healthcare and life Sciences deal value in H2 has fallen december has also brought a wave of strategic mergers,
roughly 83% to uS$27.6bn, while Financial Services deal value most of which fall in the mid-market range, to the biotech
has dropped by about 73% to uS$18.5bn. but H1 figures in both and pharmaceutical industries. Cubist pharmaceuticals,
of these sectors were grossly inflated: the Merck-Schering for example, recently announced its acquisition of Calixa
plough, pfizer-Wyeth and roche-Genentech mergers together Therapeutics, a uS$93m deal that allows Cubist to obtain
amount to an astounding uS$151.5bn, while high-profile bank certain drug development rights owned by Calixa, a uS-based
bailouts, including the Treasury’s uS$25bn investment into drug developer focused on antibiotics. uS-based Celgene
Citigroup, made up the bulk of Financial Services deal value Corporation also announced a strategic acquisition earlier
in this period. Thus, H2’s significantly lower deal value is not in the month with its uS$640m purchase of Gloucester
necessarily surprising, and it should not overshadow the fact pharmaceuticals Inc.
that deal volume in all three of these sectors has been on the
Medical device companies are consolidating at a fast pace
rise in the past six months. Indeed, the leading sectors in the
as well. uS-based Stryker Corporation illustrates this quite
first half of the year have remained at the forefront in terms of
clearly, announcing two acquisitions this december. First,
overall M&A volume thanks to industry-specific drivers that are
Stryker announced its uS$525m acquisition of Ascent
set to keep M&A activity strong throughout 2010.
Healthcare Solutions Inc., which it bought from purchased from
roundTable partners, and later in the month announced its
HEAlTHCArE ANd lIFE SCIENCES KEEpS plans to acquire orthopedics-focused Ostimed Corporation for
up TO SpEEd uS$67m.
In the Healthcare and life Sciences industry, competition in
distinct subsectors has been the driving force behind most FINANCIAl SErvICES SECTOr: SMAllEr plAY-
mergers, which have increased in volume from 118 deals in ErS KEEp dEAl vOluME HIGH
H1 to 126 deals in H2 so far. looming patent expirations in the
As is the case in the Healthcare and life Sciences industry,
pharmaceutical space have caused many companies to bulk up
a string of unusually large transactions in the first half of the
their offerings, while the push for updated, digitized information
year make the recent decline in M&A value seem inevitable.
management systems has driven consolidation among the
but also like the Healthcare and life Sciences space, this
IT service providers to the healthcare industry. On top of
decrease in value is coupled with an increase in deal volume
this, North America’s aging population is expected to place
driven by a very specific set of drivers, including distress in
enormous demand on medical device and drug companies,
the uS banking industry and heightened competition in the
making these businesses prime targets in recent months.
asset management space.
These drivers are alive and well in recent activity. Tech-savvy,
Companies in the mid-market range can be credited with
IT-focused companies have produced some major buyouts
boosting Financial Services deal volume over the past
in recent weeks, attracting particular interest from financial
several months, which has increased by about 12% from
buyers. last month saw the uS$5.1bn acquisition of uS-based
172 deals in H1 to 193 deals in H2. While the first half of
IMS Health, an information solutions company servicing
the year was characterized by deals involving the industry’s
healthcare providers, by the Canada pension plan Investment
giants, M&A in the second half of the year is dominated by
board and uS-based private equity firm TpG Capital, followed
the smaller firms, starting with the uS$290m acquisition
by Francisco partners’ uS$117m acquisition of QuadraMed
of Anchor banCorp Wisconsin by badger Anchor Holdings
Corporation, a uS-based healthcare IT provider that develops
and uMb bank’s acquisition of American National bank’s
software and services for hospitals throughout the uS,
corporate trust division.
announced in early december.
Monthly M&A report
INTrOduCTION /
NOrTH AMErICAN M&A
05
The deals that followed shortly behind reveal the lingering The enormous price tag attached to ExxonMobil’s purchase of
impact of the financial crisis, with regional banks replacing XTO Energy has naturally placed this particular acquisition in
global banks as the most common troubled targets. For the spotlight, but it is worth noting that this is in fact just one
example, Greater Atlantic bank, which has assets of about of several significant, albeit smaller, recent mergers in the
uS$203m, was acquired by Sonabank this month after going into industry. last month, uS-based denbury resources announced
receivership in October. benchmark bank, with assets of about its uS$4bn acquisition of Encore Acquisition Company, a uS-
uS$179m, also went into receivership before being acquired by based oil and natural gas company. Months earlier in August,
Mb Financial bank NA this month. In a similar vein, the State baker Hughes announced its uS$5.5bn acquisition of bJ
bank and Trust Co. acquired two banks in receivership under the Services Company.
FdIC: buckhead Community bank in the South, after it was shut
Growth and geographical expansion are the common
down by the Georgia department of banking and Finance, and
denominators in most of the industry’s recent transactions.
then First Security National bank.
This has been particularly important to Asian buyers, who have
Not all M&A in the Financial Services sector shows signs of been key players in the M&A landscape during the second
distress, however. The asset management industry is seeing half of 2009. In November, China Investment Corporation (CIC)
healthier strategic M&A activity following uS-based asset announced its plans to acquire a 15% stake in AES Corporation,
manager blackrock’s uS$13.6bn acquisition of barclays Global the uS-based power company. The previous August, another
Investors (bGI) earlier in the year. The blackrock-bGI merger Chinese bidder, petroChina Company limited, agreed to acquire
created the world’s largest asset manager and ramped up the a 60% stake in Mackay river and dover oil sands projects from
competition for its peers, which may explain why smaller firms Athabasca Oil Sands Corp (AOSC), a Canadian company. The
are beefing up their product offerings with add-on acquisitions. flurry of large-cap Energy transactions involving Asian bidders,
This month, for example, uS-based asset manager Affiliated especially Chinese bidders, is likely to continue as these buyers
Managers Group Inc. (AMG) acquired Highbury Financial look to establish themselves on North American soil.
for uS$114m, in a deal that allows AMG to gain control of
institutional investment manager Aston Asset Management, OuTlOOK FOr 2010
Highbury’s sole subsidiary. Another example is the merger The sectors responsible for the landmark transactions of 2009
of TWC Group and Metropolitain West Asset Management, are likely to remain in the headlines, with or without mega-deals.
announced earlier this month. In acquiring Metropolitan West, Indeed, Healthcare and life Sciences and Financial Services
TCW Group, the uS-based asset management subsidiary of each contain a potent mixture of deal drivers that have set M&A
Societe Generale de France, immediately enhanced its fixed in motion over the past six months and will continue to do so in
income product offering and gained access to the target’s the months ahead. likewise, in the Energy sector, companies
uS$30bn in assets under management. across the globe have illustrated their appetite for acquisitions,
especially foreign buyers who have turned North America into
lArGE-CAp dEAl FlOW IN THE ENErGY SECTOr an Energy M&A hotspot. The unique conditions in each of these
last but not least, the Energy sector is seeing a promising level industries have kept M&A going in a particularly difficult climate
of M&A activity—in both volume and value terms—in the second for closing deals, giving us plenty to look forward to as we move
half of 2009. The industry has witnessed a remarkable 39% into the new year
increase in deal volume and a 56% increase in value from H1 to By elizabeth castro, remark
H2 so far, from 104 worth uS$52.3bn to 145 worth uS$81.6bn.
The most significant transaction in this space is now ExxonMobil
Corporation’s uS$40.3bn purchase of XTO Energy Inc., both uS
companies. The deal, which propelled Energy above all other
sectors in terms of aggregate M&A deal value, is driven primarily
by ExxonMobil’s desire to establish itself in the natural gas
space, where it had previously lagged behind its competitors.
Monthly M&A report
INTrOduCTION /
ruSSIAN bANKING SECTOr:
SOurCES SCEpTICAl AbOuT
CONSOlIdATION prOSpECTIvES
06
ruSSIAN bANKING SECTOr SOurCES ANd ANAlYSTS HAvE bECOME lArGElY SCEpTICAl AbOuT prOSpECTS
FOr bANKING MArKET CONSOlIdATION IN THE NEAr FuTurE.
bANKS TO CONCENTrATE ON ClEANING Still, the analyst said that economic recovery is under way.
bOOKS FrOM bAd ASSETS INSTEAd OF M&A The ruble exchange rate is stable and there is a consensus
view that the banking system is close to the peak of non-
Talking on the sidelines of the Adam Smith russian banking
performing loans accumulation and the asset quality situation
Forum in london, one sector source said that mid-sized banks,
is manageable, the analyst said. There is a big uncertainty as
which are being viewed as potentially the main drivers for
to short-term prospectives, but in three to four years’ time,
market consolidation, do have appetites for M&A, but ‘do not
there is potential to resume a Gdp growth of 5% to 6%, Francis
dare to go ahead.’
Malige, Head of M&A at the Global retail banking division of
Facing the need to deal with growing amounts of bad loans, bNp paribas Group, said, speaking at the conference.
‘everyone is concentrating on making order in his own garden’,
banks are looking to raise capital for growth, while investors
the first source said. Another senior russian banker said that
are also more willing to believe the positives, the analyst
bad loans are a major problem for russian banks, therefore
concluded. A market source estimated additional capitalization
many of them must first ‘clean their books’ to
needs of the russian banking system at over rub 1trn (uSd
be acquired.
34bn). The source added that the government’s support, in the
A third source from a bank that recently performed asset form of subordinated loans, is largely targeted to the state-
consolidation said that despite russian banks having controlled vTb. As previously reported, there is a consensus
the appetite for M&A now, most of them lack liquidity for that vTb and Sberbank are unlikely to consolidate banks
acquisitions. Therefore, mergers through shares swaps are the in russia.
most likely way of consolidation in the foreseeable future. This
is going to create additional problems with regard to evaluation FOrEIGN plAYErS lOOKING AT
of the bank’s value and make negotiations very difficult. ruSSIAN MArKET
From about 1,000 banks, approximately 100 are potentially According to a Western European financial industry adviser, the
interesting as acquisition targets, the third source said. russian banking market remains attractive to western players.
The financial services market in russia is largely underserved,
Estimates of problem loans to total loans in the banking
while some credit niches have high profit margins. Most foreign
system differ from 9% to 25%, according to several sources.
banks are under pressure, due to the financial crisis and do not
There has been a deterioration in asset quality in 1H09,
have the appetite to seize opportunities, the source said. Still,
however, the trend has slowed in 2H09, with some data even
a few of them that have withstood the crisis well are actively
turning positive, a sector analyst said.
looking to enter russia either now, or in the foreseeable future,
the source said.
uNCErTAINTY AS TO FuTurE dEvElOpMENT
OF THE ECONOMY HINdErS M&A On the other hands, there will be foreign banks selling their
russian subsidiaries, the source said. For instance, KbC is
banks are largely puzzled as to the future of the economy,
seeking buyers for its russian subsidiary Absolut bank. There
several banking sources said. It is difficult to assess the
will be other cases like this, the source added.
current state of the economy because the evaluation of the
situation by the Central bank, the Government and other
sources differs too much, the first source said. The second
source agreed that the current situation is vulnerable and that
valuations of the banks will be a problem. bankers are trying
to invest money in unclear targets outside russia and it is
unknown what the outcome of these investments would be, the
second source added.
Monthly M&A report
INTrOduCTION /
ruSSIAN bANKING SECTOr:
SOurCES SCEpTICAl AbOuT
CONSOlIdATION prOSpECTIvES
07
russia’s banking system has an immense growth potential
and is therefore likely to remain a priority to investors, Malige
said. russian banks have again got access to international
finance after the crisis, but investors are more selective now.
Global investor confidence is likely to change towards emerging
economies, including russia, because their real Gdp growth will
be much higher than in mature economies, Malige added. large
international banks will want to invest in russia, he said.
THE GOvErNMENT’S rOlE IN STIMulATING
CONSOlIdATION TWOFOld
The financial sector analyst said that the russian Central
bank and government do not seem to be actively pushing
consolidation. Consolidation of the banking sector would be
good for the industry and has been mentioned among the
government’s priorities, however, there are still obstacles to
active M&A. An increase of the minimum capital requirement for
banks is an insufficient measure for stimulating consolidation,
the analyst said.
A source at a bank actively involved in M&A added that there has
already been significant progress in improving the procedures
for M&A of banks in the last times. As a result, the time needed
for a merger of two banks has gone down to three to four
months, the banker said.
›
By Alexander cajcyc in london
›
Monthly M&A report
INTrOduCTION /
TElE2 CONTINuES MArCH
EASTWArdS dESpITE rECENT
‘INTErSTEllAr’ SETbACK
08
TElE2, THE SWEdISH INTEGrATEd TElECOMMuNICATIONS FIrM, ANNOuNCEd IN dECEMbEr THAT IT IS TO
ACQuIrE A 51% STAKE IN MObIlE TElECOM-SErvICE llp (TrAdING AS NEO KAzAKHSTAN), THE KAzAKH
MObIlE pHONE NETWOrK OpErATOr, FrOM JSC KAzAKHTElECOM, THE lISTEd KAzAKHSTAN bASEd
TElECOMMuNICATIONS COMpANY, FOr A CASH CONSIdErATION OF ApprOXIMATElY €52.6M (SEK550M).
The agreement, once approved by regulatory authorities, will Tele2 was founded in 1993 and currently has 26m customers
see Tele2 inject approximately €34.4m (SEK360m) into the across 10 countries providing mobile services, fixed broadband
business. This capital will be predominantly used to upgrade and telephony, data network services, cable Tv and content
its urban network capacity, where most of the countries 12m services. In 2008, the group declared net sales of €3.7bn
population is centred, and to relaunch the service. (SEK38.3bn) with an EbITdA operating profit of €788m
(SEK8.2bn). during Q3 2009, net sales rose 3% year on year to
NEO Kazakhstan is the smallest of the three mobile network
approximately €938m (SEK9.76bn) on the back of its successful
operators in the country with just 5% market share and
Tele2 russia operation, which launched services in seven
approximately 380,000 customers. The market leaders,
new regions, adding 1.1m customers; solid organic growth in
TeliaSonera’s K-Cell and vimpelcom’s beeline, each have
its home Swedish market; and a slight gain in market share
around a 45% share of the market.
across their baltic operations.
Tele2 hope to leverage the experience gained from the
Tele2’s interim January-September 2009 results, published
successful roll-out of their russian services, which by Q3
in October, stated that, “Tele2’s future growth lies within our
2010 will provide coverage in 37 regions in the country, to hit
emerging market footprint, with a strong emphasis on russia.”
the ground running. The stated intention for the new Kazakh
Accordingly, the latest move is a continuation of Tele2’s
division is to grow its market share to 20% within four years
ongoing realignment strategy, placing the company in high-
of the company’s relaunch as a price leader and for EbITdA
growth, rapidly expanding new markets that, given time, will
to break even in two to three years. These optimistic targets
potentially offer significantly higher profit margins than the,
are based on the Kazakh market’s already considerable
already saturated and fiercely competitive, mature markets
mobile penetration (estimated at 90%); its poor fixed-line
of Western Europe. In the last three years alone, Tele2 has
network; good churn rate (35% per annum); and the country’s
divested holdings in belgium, France, Spain, Italy, portugal,
encouraging economic growth prospects, which forecasts Gdp
Switzerland, Austria, luxembourg and poland.
growth expanding at an average of 4.5% per annum over the
next 10 years. The most recent example of Tele2’s divestment process was
the sale of Tele2 France to virgin Mobile France, the subsidiary
As part of the deal, Tele2 have the option to buy the remaining
of uK based virgin Group ltd and Carphone Warehouse Group
49% of the firm from Asianet Holdings b.v., the Netherlands-
plc. The divestments completion was announced on the
based private investment group holding the remaining share
same day as The NEO Kazakhstan deal, after permission was
capital in NEO Kazakhstan. Speaking about the deal, Harri
granted by French anti-trust authorities, and will see Tele2
Koponen, the president and CEO of Tele2 said, “The acquisition
France, the France-based provider of mobile phone, fixed-
of a mobile operation in Kazakhstan goes hand in hand with
line carrier and internet telecom’s services, sold for €55.62m
our ambition to carefully look for complementary assets in,
(SEK575m). Tele2 France had 429,000 customers in June
or close to, our mobile footprint. Given the proximity of the
2009 and a turnover of €119.3m (SEK1,233m) in 2008, with an
Kazakhstan asset to other Tele2 operations, this acquisition
EbIdTA of €580,000 (SEK6m). The acquisition is expected to
should provide the potential of synergies deriving from the
reduce virgin Mobile France’s operating costs by generating
replication of our successful operational model.”
economies of scale and by enhancing their relationship with
network operators.
Monthly M&A report
INTrOduCTION /
TElE2 CONTINuES MArCH
EASTWArdS dESpITE rECENT
‘INTErSTEllAr’ SETbACK
09
The purchase of NEO Kazakhstan comes as good news
after a difficult few months for the firm. In November, the
latvian government announced that it was to cancel all of its
outstanding contracts with Tele2 after what turned out to be a
poorly thought-out publicity stunt coordinated by Tele2’s latvian
operation, but approved by head office, spectacularly back-fired.
On the 25 October, the company staged a ‘meteorite strike’
near the Estonian border by digging a hole, burying chemicals
and setting fire to the ‘crater’. The latvian military, government
scientists, police and fire service all attended the ‘crash site’,
cordoning off the area in order to undertake safety tests and
establish the objects origin. However, by daylight the next day, it
was confirmed to be a hoax by experts.
On 27 October, Tele2 admitted to perpetrating the prank as
part of a new marketing strategy, saying that the episode had
been intended to distract attention away from the economic
crisis in latvia to ‘something more interesting’. They said that
they would compensate the government and cover any costs
incurred by the ‘extraterrestrial’ event. On the 26 October, the
latvian government published its austerity budget for 2010,
which severely slashed government spending and raised taxes
in a bid to continue to narrow the budget deficit, a necessity
for the maintenance of the €7.5bn emergency bailout funds
secured from the IMF and European Commission at the height
of the economic crisis which prevented the countries wholesale
economic collapse. Oh how we all laughed…
By rory Mcneil, remark
Monthly M&A report
A MERgERMARkET M&A REpORT ON
NORTH AMERICA
North American M&A overview • Currently, insolvency related transactions make up
12.26% or $81.6bn of North American deals to date
NORTH AMERICA
• Q4 09 is signaling a slight turnaround in North American
by value, and nearly 10% or 248 deals, by volume. The
M&A, as investors get ready to put one of the worst
most active Financial Advisors in the insolvency related
years in the market behind them. The dollar amount has
deals are Lazard and Rothschild, advising on 17 and 14
already exceeded the previous quarter by $5bn. However,
transactions, valued at $16.2n and $33.6bn respectively.
activity remains weak, and rightfully reflects the current
Weil Gotshal & Manges and Skadden Arps Slate Meagher
state of the global economy.
& Flom are the most active Legal Advisors, advising on 23
• In early November, Berkshire Hathaway announced its and 17 insolvency related transactions, valued at $54.6bn
largest acquisition to date, the $35 billion investment and $3.7bn.
in Burlington Northern Santa Fe Corporation, a listed
• On the consolidated league tables, Goldman Sachs
US based railway company. Prior to the transaction,
is ranked as the top Financial Advisor, surpassing its
Berkshire Hathaway held a 22.6% stake in the company.
closest competitor Morgan Stanley by $32.9bn. Skadden
BH has recently received antitrust clearance from the
Arps Slate Meagher & Flom is ahead of Cravath Swaine
FTC. The transaction is expected to close during the first
& Moore by $22.6bn. Jones Day advised on the most
quarter of 2010.
transactions to date, 144 valued at $18.58bn.
• Bristol-Myers Squibb Company is spinning off its 83.1%
stake in Mead Johnson Nutrition Company to its existing
shareholders. The deal is valued at $6.5bn. The exchange
offer will expire on December 14, 2009.
• Meanwhile, in Canada the largest deal for the month is
valued at $769m. CIENA Corporation has entered into
a stalking horse asset sale agreement to acquire the
Metro Ethernet Networks business of the bankrupt Nortel
Networks Corporation. The sale is part of the company’s
restructuring process.
Monthly M&A Report 10
DEAL OF THE MONTH
Target: Burlington Northern Santa Fe Corporation Announced: 03 Nov 2009
NORTH AMERICA
Bidder: Berkshire Hathaway Inc Deal value: $35,574m
Seller: - Deal nature: Acquisition, Domestic, Public
STRUCTURE • BNI stockholders will have an option to receive all stock
or all cash, subject to a proration feature such that the
• Burlington Northern Santa Fe Corporation (BNI), a
overall mix of consideration is 60% cash and 40% BRK
Delaware corporation, has signed a definitive agreement
stock.
to be acquired by Berkshire Hathaway Inc. (NYSE: BRK.A;
BRK.B), a Delaware corporation. The boards of directors of • If a superior offer were to emerge for BNI, the company
both companies have approved the merger. would be required to give BRK at least 5 business days to
make adjustments to its current offer before BNI’S board
• Burlington Northern Santa Fe Corporation, a US based
of directors could effect a change of recommendation of
company headquartered in Fort Worth, TX is a holding
the deal.
company and through its subsidiaries, is engaged
primarily in the freight rail transportation business.
• Berkshire Hathaway Inc., a US based company CONDITIONS
headquartered in Omaha, NE, is a holding company • HSR (USA)
owning subsidiaries engaged in a number of business • BNI EGM ( 66 2/3% shareholder approval required)
activities, the most important of these being insurance
businesses conducted on both a primary basis and a • BRK EGM
reinsurance basis.
EXPECTED COMPLETION
TERMS • The transaction is expected to close in the 1st quarter
• $100 per share subject to proration in cash and stock. of 2010.
• The offer provides a premium of 31.4% based on BNI’s
closing share price on 02-Nov-09 of $76.07. TERMINATION DATE
• The termination date for the transaction is 30-Jun-
• The implied equity value of the transaction is approx.
10, but it can be extended to 31-Jul-10 under certain
$34.043bn.
circumstances
• The equity value that needs to be paid for is approx.
$26.34bn, since BRK already owns 22.6% of BNI.
TERMINATION FEE
• The stock portion of the offer is subject to collar.
• $264m, or 0.7% based on the implied equity value of the
BRK share received is fixed at $100.00 if the price of
deal. The per-share increase required to cover this fee in a
BRK.A stock at closing is between approx. $80,000 and
superior offer would be $0.77.
approximately $25,000 per share. If the value of BRK. A
stock is outside of this collar range at closing, then the
number of shares received of BRK.A A stock will be fixed POST DEAL DETAILS
at either 0.001253489 per BNI share for values below the • BRK already owns 22.6% of BNI Equity
collar range, or 0.000802233 per BNI share for values
above the collar range.
Monthly M&A Report 11
DEAL OF THE MONTH
Exit multiples - Y/E 30/06/2009 Premium analysis
NORTH AMERICA
Multiples Value ($m) Offer price per share ($) 100
Revenue 2.4 x 18,018 1 day before 31.46%
EBITDA 8.1x 5,309 1 month before 26.82%
EBIT 11.1x 3,912 1 day after 2.99%
Earnings 16.4 x 2,115 Pre-rumour -
Advisers
Target/Seller Bidder
Financial Goldman Sachs Financial Internal
Evercore Partners
Legal Cravath Swaine & Moore Legal Munger Tolles & Olson
Advising Goldman Sachs: Sullivan & Cromwell
mergermarket/dealReporter Intelligence
25-Nov-09 BNSF/Berkshire on steady course, estimating March 2010 close, source says
05-Nov-09 BNSF/Berkshire Hathaway clearance from DoJ, FCC expected to be smooth ride – industry sources
03-Nov-09 BNSF/Berkshire Hathaway deal struck in less than two weeks, rival bid unlikely, source says
Timetable and Expected Events
Regulatory Date Completed Notes
HSR (USA) 04-Dec-09 Y 30 cd waiting period; further 30 cd following compliance with the request for additional information; early
termination granted
Offer Timetable
Termination Date 30-Jun-10 re date by which merger must be completed before agreement must be amended; can be extended to
31-Jul-10
Prelim Proxy re preliminary proxy statement filed with SEC, reviewing process typically lasts at least 30 cd, and can be as
long as 60 cd
Def Proxy re definitive proxy statement declared effective by SEC
Effective Date re date merger becomes effective, normally 2 td after EGM approval
Settlement Date re date payment can be expected by, normally within 4 business days of Effective Date in state of Delaware
Company Events
BNI EGM re approval of merger by target's shareholders; normally 1m from def proxy
BRK EGM re approval of merger by bidder's shareholders; normally 1m from def proxy
BNI EGM record date re date shares must be held by in order to vote at the EGM
BRK EGM record date re date shares must be held by in order to vote at the EGM
Monthly M&A Report 12
TOP DEALS
TOP 15 NORTh AMERICAN ANNOUNCED DEALS FOR YTD 30 NOVEMBER 2009
NORTH AMERICA
Announced Status Target company Sector Bidder company Seller company Exit multiples (x) Bid premia Deal value
Revenue EBITDA P/E 1-day before ($m)
26-Jan-09 C Wyeth Pharma, Pfizer Inc 2.8 11.6 15.3 14.7% 63,266
Medical &
Biotech
1-Jun-09 C Motors Liquidation Industrials & The United States Motors - 48,207
Co. (bulk of assets) Chemicals Department of Liquidation Co.
the Treasury; the
Governments of Canada
and Ontario;and the
Voluntary Employees
Beneficiary Association
30-Jan-09 C Genentech Inc Pharma, Roche Holding Ltd 7.7 17.4 29.6 13.0% 44,291
(44.20% stake) Medical &
Biotech
9-Mar-09 C Schering Plough Pharma, Merck & Co Inc 2.3 8.7 22.1 33.9% 43,198
Corporation Medical &
Biotech
3-Nov-09 p Burlington Transportation Berkshire Hathaway Inc 2.4 8.1 16.4 31.5% 35,574
Northern Santa Fe
Corporation
10-Jun-09 C Citigroup Inc (36% Financial United States n/a n/a -4.7% 25,000
stake) Services Department of the
Treasury
23-Mar-09 C Petro-Canada Energy, Mining Suncor Energy Inc 0.8 2.9 6.2 34.8% 18,400
& Utilities
4-May-09 C Liberty TMT The DirecTV Group Inc - 15,519
Entertainment Inc
19-Mar-09 C IndyMac Federal Financial MSD Capital LP; J.C n/a n/a - 13,900
Bank FSB Services Flowers & Co LLC;
Stone Point Capital LLC;
Paulson & Co Inc; Soros
Strategic Partners LP;
and Silar Advisors LP
11-Jun-09 p Barclays Global Financial BlackRock Inc Barclays Plc n/a n/a - 13,653
Investors Services
4-Aug-09 p Pepsi Bottling Group Consumer PepsiCo Inc 1.0 7.4 49.3 8.6% 10,640
Inc (67% stake)
24-Jun-09 C Addax Petroleum Energy, Mining Sinopec International 2.3 4.7 9.3 15.7% 8,800
Corporation & Utilities Petroleum Exploration
and Production
Corporation
13-May-09 p Verizon (local TMT Frontier Communications Verizon - 8,600
wireline operations Communications
in 14 states) Inc
21-May-09 C GMAC (undisclosed Financial United States n/a n/a - 7,875
economic interest) Services Department of the
Treasury
28-Sep-09 p Affiliated Computer Business Xerox Corporation 1.1 6.6 17.7 33.6% 7,352
Services Inc Services
C = Completed; P = Pending; L = Lapsed Source: mergermarket
Monthly M&A Report 13
TOP DEALS
TOP 5 NORTh AMERICAN ANNOUNCED DEALS OF ThE MONTh (NOVEMBER 2009)
NORTH AMERICA
Announced Status Target company Sector Bidder company Seller company Exit multiples (x) Bid premia Deal value
Revenue EBITDA P/E 1-day ($m)
before
3-Nov-09 p Burlington Transportation Berkshire Hathaway Inc 2.4 8.1 16.4 31.5% 35,574
Northern Santa Fe
Corporation
15-Nov-09 p Mead Johnson & Consumer Bristol-Myers Squibb Bristol-Myers 3.1 11.9 16.6 -15.0% 6,538
Company (83.10% Company (Shareholders) Squibb Company
stake)
5-Nov-09 p IMS Health Inc Pharma, Medical IMS Health Consortium 2.2 8.6 12.9 30.9% 5,057
& Biotech
2-Nov-09 p Black & Decker Consumer The Stanley Works Inc 0.8 8.1 11.9 21.6% 4,621
Corporation
1-Nov-09 p Encore Acquisition Energy, Mining Denbury Resources Inc 3.5 3.9 6.2 34.9% 4,014
Company & Utilities
C = Completed; P = Pending; L = Lapsed Source: mergermarket
Monthly M&A Report 14
EXPECTED DEALS
PIPELINE OF NORTh AMERICAN EXPECTED DEALS
NORTH AMERICA
Situation Target company Sector Potential bidder Financial Seller Market cap/ Comments
company adviser to bidder company est. value
(B); target (T); ($m)
seller (S)
Expected Deal Enerflex Systems Industrials & Toromont 622 Toromont Industries Ltd. (TSX:TIH)
Income Fund Chemicals Industries Ltd announced that it has made a proposal to
Enerflex Systems Income Fund(TSX:EFX.
UN) to enter into a business combination
with TIH whereby holders of the trust units
of EFX would receive cash and shares of
Toromont representing total consideration of
CAD13.50 per unit. The consideration would
be comprised of at least 50% cash, with the
balance in TIH common shares. Unitholders
could elect to receive either CAD 13.50 in
cash or a fixed number of TIH common
shares, within the limits of total cash and
shares allocated to the transaction.
Expected Deal OPTI Canada Inc Energy, Mining Total SA, China (T)Scotia 558 OPTI's Board of Directors is assessing a
& Utilities Petroleum Waterous; TD range of strategic alternatives that may
& Chemical Securities include capital markets opportunities,
Corporation, restructuring the current credit facility,
Nexen Inc or asset divestitures, and/or a corporate sale,
China National merger or other business combination. OPTI
Offshore Oil does not intend to disclose developments
Corporation Ltd with respect to the strategic review process
unless and until its Board of Directors has
approved a definitive transaction or strategic
option.
Expected Deal Forsys Metals Energy, Mining Undisclosed (T) Morgan 344 Forsys Metals Corp (FSY) announced that
Corp & Utilities bidder Stanley is has hired Morgan Stanley to assist with
its strategic review. The review will examine
opportunities with the objective of further
enhancing shareholder value. Opportunities
include assessment of financing alternatives
for bringing the Valencia uranium project
into production, exploring strategic alliances,
joint venture opportunities, mergers,
acquisitions, or a sale of all or part of the
business.
Expected Deal Delta Petroleum Energy, Mining Undisclosed (T) Evercore 245 Delta Petroleum Corporation (Nasdaq:
Corporation & Utilities bidder Partners, DPTR), an independent oil and gas
Morgan exploration and development company
Stanley ("Delta" or the "Company"), announced today
that it has retained Morgan Stanley and
Evercore Partners to evaluate and advise the
Board of Directors on strategic alternatives
to enhance shareholder value. This will
include, but not be limited to, exploring the
sale of some or all of the Company's assets,
partnerships and joint venture opportunities,
and the sale of the entire Company.
"
Monthly M&A Report 15
LEAGUE TABLES
TOP 20 FINANCIAL ADVISERS – NORTh AMERICA
NORTH AMERICA
VALUE VOLUME
YTD house Value Deal YTD house Value Deal
30-Nov-2009 ($m) count 30-Nov-2009 ($m) count
1 Goldman Sachs 349,092 124 1 Goldman Sachs 349,092 124
2 Morgan Stanley 316,146 107 2 Morgan Stanley 316,146 107
3 JPMorgan 222,023 107 3 JPMorgan 222,023 107
4 Citigroup 206,402 64 4 Bank of America Merrill Lynch 181,769 87
5 Bank of America Merrill Lynch 181,714 87 5 Credit Suisse 118,267 85
6 Evercore Partners 175,725 22 6 Lazard 85,277 71
7 Barclays Capital 161,846 48 7 Deutsche Bank 101,069 67
8 Credit Suisse 118,267 85 8 Citigroup 206,402 64
9 Deutsche Bank 101,069 67 9 UBS Investment Bank 57,099 64
10 Lazard 85,277 71 10 Houlihan Lokey 4,486 62
11 Blackstone Group Holdings 69,690 21 11 RBC Capital Markets 56,039 58
12 UBS Investment Bank 57,099 64 12 Barclays Capital 161,846 48
13 Greenhill & Co 56,069 18 13 Rothschild 50,137 44
14 RBC Capital Markets 56,039 58 14 Jefferies & Company 10,706 36
15 Rothschild 50,137 44 15 BMO Capital Markets 7,647 33
16 AlixPartners 48,896 7 16 kpMg 8,607 30
17 Centerview Partners 35,977 6 17 CIBC World Markets 27,772 26
18 Royal Bank of Scotland Group 31,826 16 18 Sandler O'Neill & Partners 3,640 26
19 CIBC World Markets 27,772 26 19 PricewaterhouseCoopers 3,034 25
20 Perella Weinberg Partners 24,605 5 20 TD Securities 10,705 24
Source: mergermarket Source: mergermarket
The financial adviser league tables by value and volume have been run from 01 January 2009 to 30 November 2009 and exclude lapsed and withdrawn deals. The tables cover all sectors and
are based on the geography of either the target, bidder or seller being USA and Canada
TOP 20 LEgAL ADVISERS – NORTh AMERICA
VALUE VOLUME
YTD house Value Deal YTD house Value Deal
30-Nov-2009 ($m) count 30-Nov-2009 ($m) count
1 Skadden Arps Slate Meagher & Flom 244,951 111 1 Jones Day 18,580 144
2 Cravath Swaine & Moore 222,327 42 2 Latham & Watkins 107,695 121
3 Sullivan & Cromwell 197,299 53 3 Skadden Arps Slate Meagher & Flom 244,951 111
4 Simpson Thacher & Bartlett 190,725 64 4 Kirkland & Ellis 15,129 99
5 Cleary Gottlieb Steen & Hamilton 159,335 72 5 DLA Piper 9,498 79
6 Davis Polk & Wardwell 158,282 54 6 Cleary Gottlieb Steen & Hamilton 159,335 72
7 Wachtell, Lipton, Rosen & Katz 148,980 37 7 Blake, Cassels & Graydon 100,053 71
8 Shearman & Sterling 142,984 65 8 Dewey & LeBoeuf 130,109 69
9 Dewey & LeBoeuf 130,109 69 9 Weil Gotshal & Manges 102,722 69
10 Cadwalader, Wickersham & Taft 117,250 6 10 Cooley Godward Kronish 10,271 68
11 Clifford Chance 115,381 50 11 Shearman & Sterling 142,984 65
12 Paul Weiss Rifkind Wharton & Garrison 111,225 49 12 Simpson Thacher & Bartlett 190,725 64
13 Latham & Watkins 107,695 121 13 Wilson Sonsini Goodrich & Rosati 65,046 64
14 Weil Gotshal & Manges 102,722 69 14 Baker & McKenzie 19,364 62
15 Blake, Cassels & Graydon 100,053 71 15 O'Melveny & Myers 7,500 62
16 Debevoise & Plimpton 96,200 39 16 Stikeman Elliott 91,786 59
17 Stikeman Elliott 91,786 59 17 Gibson Dunn & Crutcher 48,317 57
18 Freshfields Bruckhaus Deringer 89,155 34 18 Davis Polk & Wardwell 158,282 54
19 Wilson Sonsini Goodrich & Rosati 65,046 64 19 Sullivan & Cromwell 197,299 53
20 Blake Dawson 64,631 9 20 McCarthy Tetrault 13,428 53
Source: mergermarket Source: mergermarket
The legal adviser league tables by value and volume have been run from 01 January 2009 to 30 November 2009 and include lapsed and withdrawn deals. The tables cover all sectors and
are based on the geography of either the target, bidder or seller being USA and Canada
Monthly M&A Report 16
LEAGUE TABLES
ACTIVITY TABLE OF PRIVATE EqUITY FIRMS ON NORTh AMERICAN BUYOUTS
NORTH AMERICA
VALUE VOLUME
YTD house Value Deal YTD house Value Deal
30-Nov-2009 ($m) count 30-Nov-2009 ($m) count
1= J.C Flowers & Co 13,900 1 1 Golden Gate Capital 528 5
1= MSD Capital 13,900 1 2 Platinum Equity 24 5
1= Soros Strategic Partners 13,900 1 3 TPG Capital 5,370 4
1= Stone Point Capital 13,900 1 4 ABS Capital Partners 99 4
5 TPG Capital 5,370 4 5 Catterton Partners - 4
6 Canada Pension Plan Investment Board 5,057 1 6 Blackstone Group 3,200 3
7 Clayton, Dubilier & Rice 3,219 2 7 General Atlantic 2,800 3
8 Blackstone Group 3,200 3 8 Advent International Corporation 2,223 3
9 General Atlantic 2,800 3 9 The Carlyle Group 940 3
10 Advent International Corporation 2,223 3 10 Centerbridge Partners 900 3
Source: mergermarket Source: mergermarket
The private equity buyout activity tables by value and volume are based on private equity firms advising the bidder on buyout deals where the dominant geography of the target company is USA
and Canada The tables by value and volume have been run from 01 January 2009 to 30 November 2009 and exclude lapsed and withdrawn deals
ACTIVITY TABLE OF PRIVATE EqUITY FIRMS ON NORTh AMERICAN EXITS
VALUE VOLUME
YTD house Value Deal YTD house Value Deal
30-Nov-2009 ($m) count 30-Nov-2009 ($m) count
1 Blackstone Group 3,320 2 1 Benchmark Capital 1,481 9
2 Sequoia Capital 2,155 6 2 Accel Partners 1,726 7
3 Accel Partners 1,726 7 3 Sequoia Capital 2,155 6
4 Benchmark Capital 1,481 9 4 American Capital 571 6
5 Vestar Capital Partners 1,300 1 5 US Venture Partners 418 6
6 GTCR Golder Rauner 900 3 6 New Enterprise Associates 520 5
7 Venture Frogs 807 1 7 Warburg Pincus 407 5
8 Draper Fisher Jurvetson 750 4 8 Greylock Partners 336 5
9 Northgate Capital 750 1 9 August Capital 187 5
10 VantagePoint Venture Partners 707 3 10 Menlo Ventures 137 5
Source: mergermarket Source: mergermarket
The private equity exit activity tables by value and volume are based on private equity firms advising the vendor on exit deals where the dominant geography of the target company is USA and
Canada The tables by value and volume have been run from 01 January 2009 to 30 November 2009 and exclude lapsed and withdrawn deals
Monthly M&A Report 17
TREND GRAPHS
NORTh AMERICAN M&A qUARTERLY TREND
NORTH AMERICA
VALUE NUMBER
600,000 1,400
1,200
500,000
1,000
400,000
volume of deals
value ($m)
800
300,000
600
200,000
400
100,000
200
0 0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
04 04 04 04 05 05 05 05 06 06 06 06 07 07 07 07 08 08 08 08 09 09 09 09* 04 04 04 04 05 05 05 05 06 06 06 06 07 07 07 07 08 08 08 08 09 09 09 09*
Moving
average
trend line
NORTh AMERICAN M&A qUARTERLY PRIVATE EqUITY TREND
VALUE VOLUME
225,000 275
200,000 250
225
175,000
200
number of deals
150,000
175
value ($m)
125,000 150
100,000 125
100
75,000
75
50,000
50
25,000
25
0 0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
04 04 04 04 05 05 05 05 06 06 06 06 07 07 07 07 08 08 08 08 09 09 09 09* 04 04 04 04 05 05 05 05 06 06 06 06 07 07 07 07 08 08 08 08 09 09 09 09*
North American buyouts North American buyouts
North American exits North American exits
Monthly M&A Report 18
TREND GRAPHS
NORTh AMERICAN M&A ANNUAL TRENDS
NORTH AMERICA
VALUE VOLUME
2,000 6,000
5,000
1,500
4,000
number of deals
value ($bn)
1,000 3,000
2,000
500
1,000
0 0
2004 2005 2006 2007 2008 YTD 2009* 2004 2005 2006 2007 2008 YTD 2009*
All North American M&A All North American M&A
North American buyouts North American buyouts
North American exits North American exits
NORTh AMERICAN M&A SECTOR BREAkDOwN YTD 2009
VALUE VOLUME
0.2% 0.7%
0.7%
0.1% 0.2% 1.8% 0.5%
0.7%
10.9% 2.8%
Industrials & Chemicals 3.1% TMT
18.9%
Financial services Industrials & Chemicals
9.2%
28.8% 12.2 % Business services Financial services
Consumer Energy, Mining & Utilites
Energy, Mining & Utilites Business services
9.2%
5.5 % TMT 15.4% Consumer
Leisure Pharma, Medical & Biotech
6.5% Transportation Leisure
5.5% 12%
Pharma, Medical & Biotech Construction
1%
Construction Transportation
13.2%
12.3% 16.1% Agriculture Defence
12.5%
Real Estate Real Estate
Defence Agriculture
Monthly M&A Report 19
TREND GRAPHS
NORTh AMERICAN M&A DEAL SIzE BREAkDOwN
NORTH AMERICA
VALUE VOLUME
1,000 3,000
900
2,500
800
700
2,000
number of deals
600
value ($bn)
500 1,500
400
1,000
300
200
500
100
0 0
H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2
2004 2004 2005 2005 2006 2006 2007 2007 2008 2008 2009 2009* 2004 2004 2005 2005 2006 2006 2007 2007 2008 2008 2009 2009*
> $501m > $501m
$251m-$500m $251m-$500m
$101m-$250m $101m-$250m
$15m-$100m $15m-$100m
$5m-$14.9m $5m-$14.9m
Value not disclosed
Monthly M&A Report 20
MID-MARKET DEALS
TOP 10 NORTh AMERICAN ANNOUNCED MID-MARkET DEALS OF ThE MONTh (NOVEMBER 2009)
($10M TO $250M)
NORTH AMERICA
Announced Status Target company Sector Target/seller Target/seller Bidder company Bidder Bidder legal Seller company Deal
financial legal adviser financial adviser value
adviser adviser ($m)
9-Nov-09 p TriAxon Energy, Peters & Co Macleod Dixon Crescent Point BMO McCarthy 231
Resources Ltd Mining & Energy Corp Capital Tetrault
Utilities Markets;
National
Bank
Financial
30-Nov-09 C Guardium Inc Business Jefferies & Cooley IBM Corporation Cleary Gottlieb Ascent Venture 225
Services Company Godward Steen & Partners;
Kronish Hamilton; Cedar Fund;
Cravath Swaine Cisco Systems
& Moore Inc; StageOne
Ventures ;and
Veritas Venture
Partners
5-Nov-09 p i2 Technologies Business Thomas Munsch Hardt JDA Software Goldman DLA Piper; 223
Inc Services Weisel Kopf & Harr Group, Inc. Sachs Advising
Partners Goldman
Group Sachs: Wilson
Sonsini
Goodrich &
Rosati
23-Nov-09 p Diedrich Coffee Consumer Houlihan Gibson Dunn Green Mountain Bank of Advising Bank 201
Inc Lokey & Crutcher; Coffee Roasters America of America
Advising Inc Merrill Merrill Lynch:
Houlihan Lynch Latham &
Lokey: Watkins; Ropes
O'Melveny & & Gray
Myers
16-Nov-09 p Canplats Energy, Genuity Blake, Cassels Goldcorp Inc gMp Cassels Brock 194
Resources Corp Mining & Capital & Graydon; Securities & Blackwell;
Utilities Markets; Lawson Neal, Gerber &
Salman Lundell; Eisenberg
Partners Skadden Arps
Slate Meagher
& Flom
2-Nov-09 L Diedrich Coffee Consumer Houlihan Gibson Dunn Peet's Coffee & Morgan Cooley Godward 186
Inc Lokey & Crutcher; Tea, Inc. Stanley Kronish
Advising
Houlihan
Lokey:
O'Melveny &
Myers
5-Nov-09 p The Travel TMT Advising Advising Seller: Scripps Networks Barclays Skadden Arps Cox 181
Channel LLC Seller: Dow Lohnes Interactive Inc Capital Slate Meagher Communications,
(65% stake) Goldman & Flom Inc.
Sachs
18-Nov-09 p Sierra TMT Jefferies & Morrison & Semtech Morgan Paul Hastings IBM Corporation; 180
Monolithics Inc Company Foerster Corporation Stanley Janofsky & Storm Ventures;
Walker and US Venture
Partners
30-Nov-09 p Dune Networks TMT Meitar Broadcom Latham & Alta Berkeley 178
Inc Liquornik Geva Corporation Watkins; Yigal Venture Partners;
& Leshem Arnon & Co Evergreen
Brandwein; Venture Partners;
Pepper Jerusalem
Hamilton Venture Partners;
Pitango Venture
Capital; and US
Venture Partners
16-Nov-09 C Anthony Forest Agriculture Advising Advising Bank The Molpus Adams and Anthony Forest 173
Products Seller: Bank of America Woodlands Reese Products
Company (pine of America Merrill Lync: Group, LLC Company
sawtimber Merrill Dewey &
timberland) Lynch LeBoeuf;
Morrison &
Foerster
Monthly M&A Report
Source: mergermarket 21
MID-MARKET DEALS
NORTh AMERICAN M&A qUARTERLY MID-MARkET TREND
NORTH AMERICA
VALUE VOLUME
40,000 600
35,000
500
30,000
400
number of deals
25,000
value ($m)
20,000 300
15,000
200
10,000
100
5,000
0 0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
04 04 04 04 05 05 05 05 06 06 06 06 07 07 07 07 08 08 08 08 09 09 09 09* 04 04 04 04 05 05 05 05 06 06 06 06 07 07 07 07 08 08 08 08 09 09 09 09*
Moving
average
trend line
Monthly M&A Report 22
MID-MARKET LEAGUE TABLES
TOP 15 MID-MARkET FINANCIAL ADVISERS – TOP 15 MID-MARkET LEgAL ADVISERS –
NORTh AMERICA NORTh AMERICA
NORTH AMERICA
($10M TO $250M) ($10M TO $250M)
YTD house Value Deal YTD house Value Deal
30-Nov-2009 ($m) count 30-Nov-2009 ($m) count
Value: Value:
1 JPMorgan 4,614 35 1 Latham & Watkins 3,932 43
2 Credit Suisse 4,029 32 2 Skadden Arps Slate Meagher & Flom 3,679 35
3 Goldman Sachs 4,011 33 3 Blake, Cassels & Graydon 3,427 36
4 RBC Capital Markets 3,655 33 4 Kirkland & Ellis 3,258 38
5 Morgan Stanley 3,445 28 5 Jones Day 3,041 46
6 Houlihan Lokey 3,086 34 6 Cleary Gottlieb Steen & Hamilton 2,861 26
7 Bank of America Merrill Lynch 2,337 22 7 Dewey & LeBoeuf 2,782 25
8 Deutsche Bank 2,276 22 8 Cooley Godward Kronish 2,570 40
9 UBS Investment Bank 2,075 20 9 Gibson Dunn & Crutcher 2,413 28
10 Lazard 2,029 23 10 Shearman & Sterling 2,349 24
11 Jefferies & Company 1,911 20 11 Wilson Sonsini Goodrich & Rosati 2,277 33
12 BMO Capital Markets 1,893 19 12 McCarthy Tetrault 2,199 24
13 GMP Securities 1,475 16 13 O'Melveny & Myers 2,190 29
14 CIBC World Markets 1,434 12 14 Vinson & Elkins 2,080 18
15 Citigroup 1,422 11 15 DLA Piper 2,062 34
Volume: Volume:
1 JPMorgan 4,614 35 1 Jones Day 3,041 46
2 Houlihan Lokey 3,086 34 2 Latham & Watkins 3,932 43
3 Goldman Sachs 4,011 33 3 Cooley Godward Kronish 2,570 40
4 RBC Capital Markets 3,655 33 4 Kirkland & Ellis 3,258 38
5 Credit Suisse 4,029 32 5 Blake, Cassels & Graydon 3,427 36
6 Morgan Stanley 3,445 28 6 Skadden Arps Slate Meagher & Flom 3,679 35
7 Lazard 2,029 23 7 DLA Piper 2,062 34
8 Bank of America Merrill Lynch 2,337 22 8 Wilson Sonsini Goodrich & Rosati 2,277 33
9 Deutsche Bank 2,276 22 9 O'Melveny & Myers 2,190 29
10 UBS Investment Bank 2,075 20 10 Gibson Dunn & Crutcher 2,413 28
11 Jefferies & Company 1,911 20 11 Osler, Hoskin & Harcourt 1,780 27
12 BMO Capital Markets 1,893 19 12 Cleary Gottlieb Steen & Hamilton 2,861 26
13 Rothschild 1,403 19 13 Dewey & LeBoeuf 2,782 25
14 Peters & Co 1,394 18 14 Shearman & Sterling 2,349 24
15 GMP Securities 1,475 16 15 McCarthy Tetrault 2,199 24
Source: mergermarket Source: mergermarket
The financial adviser league tables by value and volume have been run from 01 January The legal adviser league tables by value and volume have been run from 01 January
2009 to 30 November 2009 and exclude lapsed and withdrawn deals. The tables cover all 2009 to 30 November 2009 and include lapsed and withdrawn deals. The tables cover all
sectors and are based on the geography of either the target, bidder or seller being USA sectors and are based on the geography of either the target, bidder or seller being USA
& Canada & Canada
Monthly M&A Report 23
A MERgERMARkET M&A REpoRT oN
LATIN AMERICA
Volcan considering acquisition opportunities in Tek Cominco was unavailable for comment.
Peru and Latin America
LATIN AMERICA
• Letts said Volcan has no debt. “We asked for a US$200m
• Volcan, the listed Peru-based mining company, is loan before the financial crisis came. We got that loan at
considering potential acquisition opportunities in Peru Libor +0.4 interest. However, we did not know what to do
and throughout the region, said company chairman with that money so the company decided to give it back.
Roberto Letts. Letts declined to offer details on the At the moment, the company has given back US$120m,
potential targets, and emphasized that the company is with the US$80m remaining in a bank account.” He said
currently focusing on organic growth. the sum will be repaid on a monthly basis. Letts said
that thanks to a strong reduction costs programme the
• An analyst who follows the Peruvian mining sector
company has balanced its financials.
said that Volcan’s financial stability gives the company
a competitive advantage, and puts it in the position to
consider several attractive acquisition opportunities Sonico keen for IPO but has no timetable
in Peru. According to the analyst, many of Volcan’s • Sonico, the privately-held Argentina-based online social
competitors took on large amounts of debt to fuel network for Latin Americans, is keen on a listing but does
expansion during last few years, as international metal not have a timetable, Chief Executive Officer Rodrigo
prices peaked, and have since had to sell off prized assets Teijeiro said.
in order to restructure to new market realities during the
• “We do not have a timetable [for an initial public offering].
global crisis.
It is not a matter of timing, but mostly of market
• Two potential opportunities include the publicly-listed conditions for this,” Teijeiro told this news service when
Peruvian zinc and copper mine San Ignacio de Morococha asked if the company would conduct an IPO.
(Simsa), and a 22.5% stake in the Peru-based Antamina
• “We already have corporate governance and a
zinc and copper mining project held by Vancouver,
professional management. The board is analyzing the
Canada-based Teck Cominco, the analyst explained.
necessary issues to better prepare the company,” said
• The analyst said Teck Cominco is mulling ways to reduce Teijeiro. He added that the management team is more
more a $9.8bn debt burden, and will likely unload its concentrated now in improving the quality of Sonico’s
stake in Anatamina. Antamina is located in the Peruvian services.
province of Ancash and, in addition to Teck Cominco, is
• Founded in 2007, Sonico has 42 million subscribers, nine
controlled by mining majors BHP Billiton, Xstrata and
million of them in Brazil, where the company opened an
Mitsubishi Corporation.
office last week, in Sao Paulo. Sonico does not disclose its
• Simsa is a subsidiary of Peruvian conglomerate Grupo revenues, 85% of which come from advertising, according
Arias, which the analyst said has been consolidating its its website.
mining operations around gold; the company has been
• The seed capital for Sonico came from angel investors,
rumored to be preparing Simsa for a sale. This news
like Argentina-based Alec Oxenford, OLX.com’s CEO and
service reported in May that Grupo Arias was mulling the
co-founder of Deremate.com, an online bidding website.
sale of Simsa.
In May 2008, Sonico raised US$4.3m from DN Capital, a
• According to Simsa’s financial reports the company London-based venture capital fund, for an undisclosed
registered US$44.28m in 2008 revenue and an EBITDA stake.
margin of 24.10%. However, Simsa’s net profit margin in
• Teijeiro said Sonico is a very aggressive company and
2008 was down 25.12% over the previous year.
if an IPO is demanded to accelerate its growth the
• A spokesperson from Grupo Arias denied that it was company will do it, after analyzing the alternative of a new
mulling the sale of Simsa, but did affirm the group’s capitalization round.
interest in expanding its gold-based mining operations.
• Sonico does not have a financial advisor. “We will hire one,
eventually. We count on our angel investors’ expertise, it
is enough for now,” said Teijeiro. For legal affairs, Sonico
hired Argentina-based Marval, O’Farrell & Mairal law firm.
Monthly M&A Report 24
DEAL OF THE MONTH
Target: Medial Saude SA Announced: 19 November 2009
LATIN AMERICA
Bidder: Amil Assistencia Medica Internacional Ltda Deal value: $698m
Seller: Medial Participacoes SA Deal nature: Acquisition; domestic; Public
STRuCTuRe FInAnCIng:
• Amil Participacoes SA has agreed to acquire Medial Saude • Amil Participacoes SA will fund this transaction from its
SA from Medial Participacoes S.A. current cash balance.
• Medial Saude SA, the listed Brazil based company
headquartered in San Paulo, is a provider of health RATIOnALe:
insurance for individual and corporate customers. • The transaction is in line with Amil’s strategy to
• Medial Participacoes S.A., the Brazil based company consolidate Amilpar’s leadership in the Brazilian
headquartered in San Paulo, is a holding company supplementary health care market. The acquisition
engaged in the private health sector. will allow Amil to boost its market share in the health-
insurance market in Sao Paulo to 15% from 7.9%.
• Amil Assistencia Medica Internacional Ltda, the Brazil
based company headquartered in San Paulo, is a provider
of health care assistance services, and a subsidiary of Amil POST DeAL DeTAILS:
Participacoes SA. Amil Participacoes SA, the listed Brazil • Post acquisition, Amil will incorporate Medial
based company headquartered in San Paulo, is a provider Participacoes S.A. and implement a corporate
of health care assistance services. restructuring of Medial Saude S.A., which will be delisted.
TeRMS exPeCTeD COMPLeTIOn:
• 36,220,005 Medial Saude SA’s common shares at BRL • The transaction is expected to close within five days once
17.2066 ($9.87) per share representing 51.93% of Medial. the necessary conditions are fulfilled.
• The offer price of BRL 17.2066 ($10.01) per share
represents a premium of 16.9% over Medial Saude COnDITIOnS:
SA’s closing price of BRL 14.7 ($8.56) per share as on • Approval from National Supplementary Health Care
18 November 2009, the last trading day prior to the Agency.
announcement, and a premium of 63.6% over Medial
Saude SA’s closing price of BRL 10.62 ($6.11) per share as • Approval from Brazilian anti-trust authorities.
on 19 October 2009, one month before the announcement.
• Amil will pay an upfront payment equal to 20% of the total
price no later than 3 business days after the agreement
is signed, while the remaining 80% balance will be paid at
the closing date
• Amil will launch a tender offer to acquire the remaining
48.06%, within 30 days of completion of the acquisition of
51.93% under the same terms, conditions and offer price
Monthly M&A Report 25
DEAL OF THE MONTH
exit multiples - Y/e 31/12/2008 Premium analysis
LATIN AMERICA
Multiples Value ($m) Offer price per share ($) 10.01
Revenue - - 1 day before 16.91%
eBITDA - - 1 month before 63.62%
eBIT - - 1 day after 6.62%
earnings - -.09 Pre-rumour -
Advisers
Target/Seller Bidder
Lawyer Mattos, Filho, Veigo Filho, Marrey Jr. e PR Euro Communications
Quiroga advogados
Monthly M&A Report 26
TOP DEALS
TOP 15 LATIn AMeRICAn AnnOunCeD DeALS YTD 30 nOVeMBeR 2009
LATIN AMERICA
Announced Status Target company Sector Bidder company Seller company exit multiples (x) Bid premia Deal
Revenue eBITDA P/e 1-day before value
($m)
21-Jul-09 p Aracruz Celulose SA Industrials & Fibria 2.3 6.4 (loss) - 4,307
(55.20% stake) Chemicals
8-Sep-09 p GVT (Holding) SA TMT Vivendi SA Global Village 4.7 20.1 319.3 76.1% 4,306
Telecom
(Holland) BV;and
Swarth Group
7-Oct-09 L GVT (Holding) SA TMT Telecomunicacoes de 4.2 17.8 281.8 28.6% 3,818
Sao Paulo SA
19-May-09 p Sadia SA (88% Consumer BRF Brasil Foods SA 0.7 7.2 (loss) - 2,521
stake)
20-Apr-09 C Banco UBS Pactual Financial BTG Investments LP UBS AG n/a n/a - 2,500
SA Services
22-Oct-09 p Oy Metsa-Botnia Agriculture UPM-Kymmene Oyj Oy Metsa-Botnia 2,405
Ab (Uruguay Ab
operations)
23-Apr-09 C Terna Participacoes Energy, Mining Cemig Geracao e Terna - Rete 8.1 9.5 59.0 34.3% 2,177
S.A. & Utilities Transmissao S.A Elettrica
Nazionale SpA
29-Jan-09 C Glencore Energy, Mining Xstrata Coal South Glencore - 2,000
International AG & Utilities America Ltd International AG
(Prodeco business
in Colombia)
7-May-09 C Siderurgica del Industrials & Corporacion Venezolana Ternium SA - 1,970
Orinoco CA (59.70% Chemicals de Guayana
stake)
5-Aug-09 p Casas Bahia Consumer Michael Klein (Private Saul Klein 1.0 - 1,888
Comercial Ltda Individual) (Private
(25% stake) Individual)
9-Jan-09 C Banco Votorantim Financial Banco do Brasil SA Votorantim n/a n/a - 1,353
(50% stake) Services Financas
20-Jan-09 C Aracruz Celulose SA Industrials & Fibria Lorentzen Group 3.9 11.1 (loss) -19.9% 1,178
(12.40% stake) Chemicals
5-Mar-09 C Aracruz Celulose SA Industrials & Fibria Arainvest 3.8 10.7 (loss) 65.4% 1,178
(12.40% stake) Chemicals Participacoes SA
30-Jan-09 C VBC Energia SA Energy, Mining Construcoes e Comercio Grupo - 1,110
(50% stake) & Utilities Camargo Correa S.A. Votorantim
19-May-09 p Sadia SA (12% Consumer BRF Brasil Foods SA 0.7 6.9 (loss) - 1,056
stake)
C = Completed; P = Pending; L = Lapsed Source: mergermarket
Monthly M&A Report 27
TOP DEALS
TOP 5 LATIn AMeRICAn AnnOunCeD DeALS FOR YTD 30 nOVeMBeR 2009
LATIN AMERICA
Announced Status Target company Sector Bidder company Seller company exit multiples (x) Bid premia Deal value
Revenue eBITDA P/e 1-day before ($m)
19-Nov-09 p Medial Saude SA Financial Amil Assistencia Medica Medial n/a n/a 16.9% 698
Services Internacional Ltda Participacoes SA
30-Nov-09 p MMX Mineracao Energy, Mining Wuhan Iron and Steel 6.9 2.5 -43.2% 400
e Metalicos SA & Utilities Company Limited
(21.52% stake)
6-Nov-09 p Empresa Electrica Energy, Mining GDF Suez SA Corporacion 1.4 4.1 5.3 -12.4% 287
del Norte Grande & Utilities Nacional del
S.A. (25.02% stake) Cobre de Chile
23-Nov-09 p MitEnergy Upstream Energy, Mining Energy XXI (Bermuda) MitEnergy 283
LLC (Gulf of Mexico & Utilities Limited Upstream LLC
shelf oil and natural
gas properties)
19-Nov-09 p Wayne-Dalton Construction Overhead Door Wayne-Dalton 250
Corp (overhead Corporation Corp
door business in
North America and
Europe)
C = Completed; P = Pending; L = Lapsed Source: mergermarket
TOP 5 ChILeAn AnnOunCeD DeALS FOR YTD 30 nOVeMBeR 2009
Announced Status Target company Sector Target/seller Seller Bidder company Bidder Bidder legal Seller company Deal
financial company financial adviser value
adviser ($m)
28-Jul-09 C Lafarge Chile SA Construction Advising Seller: Advising Grupo Brescia Celfin Claro y Cia; Lafarge SA 460
CALYON; Seller: Carey Capital Rebaza &
Morgan y Cia Alcazar
Stanley; Abogados
Rothschild Financieros
31-Jul-09 p ING Group Financial Advising Seller: Advising CNA Chile ING Group NV 350
NV (Annuity Services Citigroup Seller: Carey Compania de
and Mortgage y Cia Seguros de Vida
business) S.A
4-Sep-09 p VTR GlobalCom TMT Celfin Capital Cristalerias de 295
SA (20% stake) Chile SA
6-Nov-09 p Empresa Electrica Energy, Advising Seller: Advising GDF Suez SA JPMorgan Prieto & Cia Corporacion 287
del Norte Grande Mining & Santander Seller: Carey Nacional del
S.A. (25.02% Utilities Global Banking y Cia Cobre de Chile
stake) and Markets
25-Jun-09 p Empresa Electrica Energy, CGE Generacion Iberdrola 282
Lican (55% stake); Mining & Energia;and
Iberoamericana de Utilities Iberdrola
Energia IBENER Energia de Chile
SA (94.74% stake) Limitada
C = Completed; P = Pending; L = Lapsed
Monthly M&A Report 28
TOP DEALS
TOP 5 AnDeAn AnnOunCeD DeALS FOR YTD 30 nOVeMBeR 2009
LATIN AMERICA
Announced Status Target company Sector Target/seller Seller Bidder company Bidder Bidder legal Seller company Deal
financial company financial adviser value
adviser ($m)
29-Jan-09 C Glencore Energy, Deloitte; Advising Xstrata Coal Deutsche Conyers Dill Glencore 2,000
International AG Mining & Advising Seller: South America Bank; & Pearman; International AG
(Prodeco business Utilities Seller: Morgan Slaughter Ltd Rothschild; Freshfields
in Colombia) Stanley and May JPMorgan Bruckhaus
Deringer;
Linklaters
10-Mar-09 C Hocol SA Energy, Advising Seller: Advising Ecopetrol SA Citigroup Shearman & Maurel et Prom 580
Mining & BNP Paribas Seller: Barbe Sterling SCA
Utilities Carpentier
Thibault
Groener
Associes;
Travers
Smith
10-Jul-09 p Protabaco Ltda Consumer JPMorgan Hogan & Philip Morris Credit Hunton & 452
Hartson; International Inc Suisse Williams;
Ibarra Prieto &
Abogados Carrizosa
16-Mar-09 C Oleoducto Central Energy, Advising Ecopetrol SA Shearman & Enbridge Inc 418
SA (24.70% stake) Mining & Seller: Baker Sterling
Utilities & McKenzie
3-Mar-09 C Compania Energy, Inversiones Citigroup 105
Colombiana de Mining & Argos SA
Inversiones SA Utilities
(15.30% stake)
C = Completed; P = Pending; L = Lapsed
Monthly M&A Report 29
EXPECTED DEALS
PIPeLIne OF LATIn AMeRICAn exPeCTeD DeALS
LATIN AMERICA
Situation Target Sector Potential bidder Financial Seller company Market cap/ est. Comments
company company adviser to value ($m)
bidder (B);
target (T);
seller (S)
Rumoured TgN Energy, Mining Emgasud Barclays Techint US$344m Emgasud, the Argentine energy company, has offered
takeover target & Utilities Plc (T) Compania (TGN debt) to buy a majority stake in Transportadora de Gas
Tecnica del Norte (TGN), a local natural gas transporter,
Internacional Pagina/12 reported. The paper cited Alejandro
SACI Ivanissevich, owner of Emgasud, as saying that that
TGN business plan must be redone, the company has
failed in its strategy and Emgasud can provide one
for the company. As reported, TGN defaulted on its
US$344m debt in December. The value of its bonds
fell to 10 cents. Following the default declaration, the
company must face government intervention.
Rumoured Express de Transportation Grupo Rios US$34m It was reported that Grupo Rios, the Colombia-
takeover target Santiago (target based conglomerate, is in talks to acquire Chilean
Uno revenue) mass transportation company Express de Santiago
Uno. According to the article sources say Grupo
Rios is currently restructuring the conglomerate’s
management and is preparing a strategy to spur
growth in Chile through acquisitions. It also states
the group is already in advanced negotiations and,
following the deal, may seek to merge Express de
Santiago Uno with Alsacia, its mass transportation
subsidiary. Express Santiago Uno, the operator of the
Troncal 4 bus line, has annual revenues of US$34m.
Expected deals based on confirmed announcements by companies involved
Monthly M&A Report 30
LEAGUE TABLES
TOP 15 FInAnCIAL ADVISeRS – LATIn AMeRICA
LATIN AMERICA
VALUE VOLUME
YTD house Value Deal YTD house Value Deal
30-nov-2009 ($m) count 30-nov-2009 ($m) count
1 Credit Suisse 11,923 20 1 Credit Suisse 11,923 20
2 JPMorgan 11,347 17 2 JPMorgan 11,347 17
3 Citigroup 9,781 11 3 Morgan Stanley 5,746 13
4 UBS Investment Bank 9,317 12 4 UBS Investment Bank 9,317 12
5 Rothschild 7,906 6 5 Citigroup 9,781 11
6 Estater Assessoria Financeira 7,412 5 6 Banco Bradesco 6,022 8
7 BNP Paribas 6,892 6 7 Rothschild 7,906 6
8 Banco Bradesco 6,022 8 8 BNP Paribas 6,892 6
9 Morgan Stanley 5,746 13 9 Estater Assessoria Financeira 7,412 5
10 Calyon 4,766 2 10 Santander Global Banking and Markets 2,083 5
11 Pohjola Corporate Finance 2,405 1 11 Goldman Sachs 1,295 5
12 Global M&A 2,205 4 12 Global M&A 2,205 4
13 Deutsche Bank 2,202 4 13 Deutsche Bank 2,202 4
14 Santander Global Banking and Markets 2,083 5 14 Bank of America Merrill Lynch 545 4
15 Deloitte 2,000 3 15 Deloitte 2,000 3
Source: mergermarket Source: mergermarket
The financial adviser leue tables by value and volume have been run from 01 January 2009 to 30 November 2009 and exclude lapsed and withdrawn deals. The tables cover all sectors and are
based on the geography of either the target, bidder or seller being Latin America
TOP 15 LegAL ADVISeRS – LATIn AMeRICA
VALUE VOLUME
YTD house Value Deal YTD house Value Deal
30-nov-2009 ($m) count 30-nov-2009 ($m) count
1 Machado Meyer Sendacz e Opice 17,379 21 1 Mattos Filho, Veiga Filho, Marrey Jr. e 7,441 25
2 Simpson Thacher & Bartlett 10,895 9 Quiroga Advogados
3 Barbosa, Mussnich & Aragao 10,251 13 2 Machado Meyer Sendacz e Opice 17,379 21
4 Pinheiro Neto Advogados 8,911 13 3 Barbosa, Mussnich & Aragao 10,251 13
5 Shearman & Sterling 8,410 7 4 Pinheiro Neto Advogados 8,911 13
6 Mattos Filho, Veiga Filho, Marrey Jr. e 7,441 25 5 Simpson Thacher & Bartlett 10,895 9
Quiroga Advogados 6 Tozzini Freire Teixeira E Silva Advogados 7,102 8
7 Tozzini Freire Teixeira E Silva Advogados 7,102 8 7 Prieto & Carrizosa 583 8
8 Motta Fernandes Rocha Advogados 6,952 5 8 Estudio Muniz, Ramirez, Perez-Taiman 227 8
9 Bredin Prat 6,778 4 & Olaya Abogados
10 Freshfields Bruckhaus Deringer 5,737 6 9 Shearman & Sterling 8,410 7
11 Skadden Arps Slate Meagher & Flom 4,572 5 10 Azevedo Sette Advogados 153 7
12 Linklaters 4,425 5 11 Freshfields Bruckhaus Deringer 5,737 6
13 DLA Piper 4,347 3 12 Carey y Cia 1,218 6
14 Clifford Chance 4,306 1 13 Motta Fernandes Rocha Advogados 6,952 5
15= Bocater, Camargo, Costa e Silva 3,577 2 14 Skadden Arps Slate Meagher & Flom 4,572 5
Advogados 15 Linklaters 4,425 5
15= Fontes, Tarso Ribeiro Advogados 3,577 2 Source: mergermarket
Source: mergermarket
The legal adviser leue tables by value and volume have been run from 01 January 2009 to 30 November 2009 and include lapsed and withdrawn deals. The tables cover all sectors and are based
on the geography of either the target, bidder or seller being Latin America
Monthly M&A Report 31
TREND GRAPHS
LATIn AMeRICAn M&A quARTeRLY TRenD
LATIN AMERICA
VALUE VOLUME
60,000 175
150
50,000
125
40,000
number of deals
value ($m)
100
30,000
75
20,000
50
10,000
25
0 0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
04 04 04 04 05 05 05 05 06 06 06 06 07 07 07 07 08 08 08 08 09 09 09 09* 04 04 04 04 05 05 05 05 06 06 06 06 07 07 07 07 08 08 08 08 09 09 09 09*
Moving
average
trend line
LATIn AMeRICAn M&A quARTeRLY PRIVATe equITY TRenD
VALUE VOLUME
2,500 15
2,000 12
number of deals
1,500 9
value ($m)
1,000 6
500 3
0 0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
04 04 04 04 05 05 05 05 06 06 06 06 07 07 07 07 08 08 08 08 09 09 09 09* 04 04 04 04 05 05 05 05 06 06 06 06 07 07 07 07 08 08 08 08 09 09 09 09*
Latin American buyouts Latin American buyouts
Latin American exits Latin American exits
Monthly M&A Report 32
TREND GRAPHS
LATIn AMeRICAn M&A AnnuAL TRenDS
LATIN AMERICA
VALUE VOLUME
120 500
100
400
80
number of deals
value ($bn)
300
60
200
40
100
20
0 0
2004 2005 2006 2007 2008 YTD 2009* 2004 2005 2006 2007 2008 YTD 2009*
All Latin America M&A All Latin America M&A
Latin American buyouts Latin American buyouts
Latin American exits Latin American exits
LATIn AMeRICAn M&A SeCTOR BReAkDOwn YTD 2009
VALUE VOLUME
0.5%
3.1% 3% 2.6%
0.9% 6% Consumer 3.3% Consumer
16.6% 20.4%
3.9%
4.5% Industrials & Chemicals Industrials & Chemicals
1.5%
Energy, Mining & Utilities
4.9% Energy, Mining & Utilities
Financial Services Financial Services
4.9%
10.2% Business Services Business Services
18.1% TMT TMT
4.9%
0.8%
Pharma, Medical & Biotech 16.8% Pharma, Medical & Biotech
Construction 6.9% Construction
Transport Transport
18.2%
Agriculture Agriculture
13.2%
19.6% Real Estate Real Estate
15.1%
Leisure Leisure
Monthly M&A Report 33
MID-MARKET DEALS
TOP 10 LATIn AMeRICAn AnnOunCeD MID-MARkeT DeALS YTD nOVeMBeR 2009
($10M TO $250M)
LATIN AMERICA
Announced Status Target company Sector Target/seller Target/seller Bidder company Bidder Bidder legal Seller Deal
financial legal adviser financial adviser company value
adviser adviser ($m)
19-Nov-09 p Wayne-Dalton Construction Overhead Door Grant Jones Day Wayne- 250
Corp (overhead Corporation Thornton Dalton Corp
door business in Corporate
North America Finance
and Europe)
23-Sep-09 C Fabrica Nacional Construction Advising Seller: Corporacion Curtis, Mallet- Lafarge SA 247
de Cementos SA Squire, Sanders Socialista Prevost, Colt &
(93.80% stake) & Dempsey Cementera Mosle
11-Nov-09 p Vale Do Ivai SA Consumer Rabobank Lilla, Huck, Shree Renuka Motilal Veirano 240
Otranto, Sugars Limited Oswal Advogados
Camargo e Investment
Messina ; Advisors
Pinheiro Neto
Advogados
26-Aug-09 C Tafisa Brazil SA Industrials & Advising Placas do Parana Simpson Thacher SCS Beheer 227
Chemicals Seller: SA & Bartlett BV;and
JPMorgan Tableros
de Fibras
Ibericos SL
9-Apr-09 p Shefa Consumer Rezende Barbosa 220
SA Administracao
e Participacoes
12-Nov-09 C Cementos Construction Grupo Votorantim Corporacion 200
Artigas SA (50% Uniland SA
stake); Cementos
Avellaneda SA
(50% stake)
9-Jun-09 p Yamana Gold Energy, Mining Advising Advising Seller: Aura Minerals Inc Genuity Blake, Cassels Yamana Gold 200
Inc (San Andres & Utilities Seller: Cassels Brock Capital & Graydon; Inc
Gold Mine); National & Blackwell Markets DuMoulin Black
Yamana Gold Inc Bank
(Sao Francisco Financial
Gold Mine);and
Yamana Gold Inc
(Sao Vicente Gold
Mine)
2-Apr-09 p Credito Financial Caja de Ahorros kpMg KPMG Abogados GMAC-RFC 195
Inmobiliario Services del Mediterraneo Auritec SA
Terras
8-Jan-09 p LA Hotels SA Leisure Barbosa, Invest Tur Brasil- Bank of Mattos Filho, gp 192
Mussnich & Desenvolvimento America Veiga Filho, Investments
Aragao Imobiliario Merrill Marrey Jr. Limited
Turistico SA Lynch e Quiroga
Advogados
18-Feb-09 C Abyara Real Estate Morgan Pinheiro Neto IPU Participacoes Banco Mattos Filho, 190
Planejamento Stanley; Advogados SA Bradesco Veiga Filho,
Imobiliario SA Valuation Marrey Jr.
(62.13% stake) Consultoria e Quiroga
Empresarial Advogados
Source: mergermarket
Monthly M&A Report 34
MID-MARKET DEALS
LATIn AMeRICAn M&A quARTeRLY MID-MARkeT TRenD
LATIN AMERICA
VALUE VOLUME
6,000 100
5,000
80
4,000
number of deals
60
value ($m)
3,000
40
2,000
20
1,000
0 0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
04 04 04 04 05 05 05 05 06 06 06 06 07 07 07 07 08 08 08 08 09 09 09 09* 04 04 04 04 05 05 05 05 06 06 06 06 07 07 07 07 08 08 08 08 09 09 09 09*
Moving
average
trend line
Monthly M&A Report 35
MID-MARKET LEAGUE TABLES
TOP 10 MID-MARkeT FInAnCIAL ADVISeRS – TOP 10 MID-MARkeT LegAL ADVISeRS –
LATIn AMeRICA LATIn AMeRICA
LATIN AMERICA
($10M TO $250M) ($10M TO $250M)
YTD house Value Deal YTD house Value Deal
30-nov-2009 ($m) count 30-nov-2009 ($m) count
Value: Value:
1 JPMorgan 1,095 8 1 Mattos Filho, Veiga Filho, Marrey Jr. e 1135 12
2 Credit Suisse 434 6 Quiroga Advogados
3 Banco Bradesco 405 3 2 Pinheiro Neto Advogados 867 7
4 Goldman Sachs 319 2 3 Barbosa, Mussnich & Aragao 767 5
5 Morgan Stanley 309 3 4 Machado Meyer Sendacz e Opice 699 8
6 UBS Investment Bank 281 4 5 Motta Fernandes Rocha Advogados 289 2
7 Grant Thornton Corporate Finance 250 1 6 Pinheiro Guimaraes Advogados 265 2
8 Citigroup 240 3 7 Skadden Arps Slate Meagher & Flom 260 2
9= Motilal Oswal Investment Advisors 240 1 8 Veirano Advogados 260 2
9= Rabobank 240 1 9 Vinson & Elkins 250 2
Volume: 10 Jones Day 250 1
1 JPMorgan 1,095 8 Volume:
2 Credit Suisse 434 6 1 Mattos Filho, Veiga Filho, Marrey Jr. e 1,135 12
Quiroga Advogados
3 UBS Investment Bank 281 4
4 Banco Bradesco 405 3 2 Machado Meyer Sendacz e Opice 699 8
5 Morgan Stanley 309 3 3 Pinheiro Neto Advogados 867 7
6 Citigroup 240 3 4 Barbosa, Mussnich & Aragao 767 5
7 Deutsche Bank 202 3 5 Estudio Muniz, Ramirez, Perez-Taiman 212 4
& Olaya Abogados
8 Goldman Sachs 319 2
9 Patria-Banco de Negocios 211 2 6 Azevedo Sette Advogados 153 3
10 Santander Global Banking and Markets 190 2 7 White & Case 145 3
Source: mergermarket 8 Rodrigo Elias & Medrano 43 3
9 Motta Fernandes Rocha Advogados 289 2
The financial adviser league tables by value and volume have been run from 01 January 10 Pinheiro Guimaraes Advogados 265 2
2009 to 30 November 2009 and exclude lapsed and withdrawn deals. The tables cover all Source: mergermarket
sectors and are based on the geography of either the target, bidder or seller being
Latin America
The legal adviser league tables by value and volume have been run from 01 January
2009 to 30 November 2009 and include lapsed and withdrawn deals. The tables cover
all sectors and are based on the geography of either the target, bidder or seller being
Latin America
Monthly M&A Report 36
the following notes pertain to data contained in this publication:
• Deals are included where the deal value is greater than or equal to EUR 5m.
• Where no deal value has been disclosed, deals are included if the turnover of
the target is greater than or equal to Eur 10m.
• Deals are included in the graphs and Top Deals in each section based on
the dominant geography and dominant sector of the target company. data
underlying the league Tables are based on deals where the bidder, target or
parent geography of either is that of the geography in focus.
• YTD 2009* refers to the period 01 January 2009 to 30 November 2009.
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