Hostile Takeovers Flare Up in Europe

Article excerpt

Announced hostile mergers and acquisitions of companies based in Europe in the first 10 months of this year set a record of $334 billion for the year-todate period, more than triple the $100 billion in the same period of 2005, according to Dealogic.

Countries based in the United Kingdom were the most heavily targeted for hostile bids in Europe so far this year, with a volume of $95 billion, followed by companies in Spain, with $91 billion of hostile bids, and Luxembourg with $40 billion.

The leading financial advisers on European hostile bids in the first 10 months of 2006 were Deutsche Bank, Citigroup, JPMorgan, UBS and Merrill Lynch, in that order, Dealogic says.

The utility and energy sector was the most active industry for hostile bids announced in Europe so far this year, with a volume of $73 billion, followed by the metal and steel industry with $40 billion and transportation with $33 billion.

Global M&A volume reached $3 trillion in January through October 2006, the highest volume since the same period of 2000 and a 37% increase over the year-to-date period for 2005, according to Dealogic. The largest deal announced in October was the buyout of US casino operator Harrah's Entertainment by Apollo Management and Texas Pacific Group.

Europe was the mosttargeted region for overall M&A, with $1.2 trillion in the first 10 months of 2006, an increase of 50% from the same period of 2005. Finance was the mosttargeted industry, followed by telecommunications and the utility and energy sector.

M&A in the financial services sector should remain near record levels in 2007, according to John Marra and Todd Williams, partners in the transaction services practice of PricewaterhouseCoopers. The record amount of capital that private equity firms have available is driving M&A momentum in financial services, Williams says. …