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 mergermarket Monthly M&A InsIder Part of the mergermarket group www.mergermarket.com 80 Strand 895 broadway #4 Suite 2001 london, Wc2r 0rl new york, ny 10003 grand millennium plaza United kingdom USA 181 Queen’s road, central Hong kong t: +44 (0)20 7059 6100 t: +1 212 686-5606 t: +852 2158 9700 f: +44 (0)20 7059 6101 f: +1 212 686-2664 f: +852 2158 9701 firstname.lastname@example.org email@example.com firstname.lastname@example.org 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 email@example.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. remark, part of The Mergermarket Group www.mergermarket.com 11 West 19th Street, 80 Strand Suite 2001 2nd fl. 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