M&A to Fall Short of 2007 Levels, Says PricewaterhouseCoopers
Transportation & Logistics
Deal activity is not on track to match the levels seen in 2007; however, the 45 deals (worth at least $50 million each) announced in the first quarter is on track to exceed 2006 levels according to the Q1 2008 edition of Intersections: Global Transportation & Logistics Mergers and Acquisitions Analysis. When excluding deals in which a U.S. entity was the acquirer or target, the number of deals (38 deals) is on pace to exceed both 2006 and 2007 levels (119 and 142 deals respectively), indicating that a concern over an economic slowdown in the United States may be lowering the attractiveness of U.S. targets, as well as the willingness and ability of U.S. acquirers to make deals. Additionally, deal value for non-U.S. acquirers and targets ($15.9 billion) is also on pace to exceed the $53.4 billion reached in 2007. Interest in logistics targets led all categories, as measured by deal value, for transactions announced in the first quarter of 2008. This was primarily due to the announcement of two large deals for logistics companies. In 2006 and 2007, the passenger air category represented a significant proportion of announced deal value (48 percent and 28 percent, respectively), and that category is expected to regain the lead throughout the rest of 2008 as a major transaction announced in April will likely trigger additional consolidation in this sector.