Global M&As rise 5% in January on telecom deals

Backed by investments in telecom, energy and retail sectors, worldwide mergers and acquisitions rose five per cent in January in comparison to the transactions made during the same month last year.

Although the share of private equity slid to the lowest total since April 2009, worldwide M&As for the month totalled $158.7 billion (Dh582bn), against $151.9bn in January 2009, according to figures released by Thomson Reuters. However, it was the lowest monthly volume by number of deals since May 2005.

While US targeted M&As slipped by 54 per cent to $37.7bn from the January 2009 figure of $82.9bn, transactions in European nations was down 20 per cent at $26.9bn against $33.6bn a year earlier.

The Asia-Pacific region, excluding Japan, saw an 88 per cent rise in M&A deals that rose from $13.1bn in January 2009 to $24.6bn.

In the top 10 target nations, Qatar was 10th with $3bn worth of mergers and acquisitions during the month. Mexico topped with $41.5bn, followed by the United States that saw $37.7bn worth of M&A activities in January.

Of the Bric nations, Brazil with $9.7bn and China with $5.5bn figured in the top 10 rankings.

Private equity-backed M&A totalled $5.8bn during January 2010, the lowest total monthly figure since April 2009 when deal activity totalled $2.1bn. It was $14.2bn in December 2009, while last year's high was the $20.4bn clocked in October. But last month's figure was a shade better than the $5.2 billion worth M&As registered in January 2009.

In keeping with the overall global trend, telecommunications, energy and power, and retail sectors were attractive buys. Three of the largest transactions backed by private equity were in the retail industry.

The $1.5bn buyout of UK-based retailer Pets at Home by Kohlberg Kravis & Roberts was the biggest.

Bolstered by the $27.5bn acquisition of Mexican telecom provider Carso Global Telecom by America Movil, the telecommunications and power and energy sectors accounted for 43 per cent of the deals announced during the month.

While worldwide M&As in the healthcare sector was worth $13.8bn or nine per cent of the total deals for January, financials accounted for $13.1bn or six per cent of the total. Transactions in the worldwide real estate sector were worth $10.1bn, just six per cent of the total deals made.

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