Transportation Space Highlights Last Week’s M&A Activity
Data from Pitchbook shows that $15.2 billion of capital was invested across 29 M&A deals last week, $4.4 billion less capital on two more deals than the previous week. The largest two deals during the week were Stonepeak Infrastructure Partners’ $3.6 billion LBO of Oryx Midstream Partners and the $2.44 billion acquisition of AmeriGas Partners by UGI Utilities. AmeriGas is a publicly traded propane distributor, and Oryx is a natural gas collection group. The transportation space was an active sector, as A&S Kinard and Buckler Transport were acquired by Day & Ross Freight; TFI International acquired Nebraska-based Aulick Leasing and its manufacturing business, ShurAul; and Providence Equity Partners acquired transportation software provider GlobalTranz.
Mergers & Acquisitions: Manufacturing Sector Sees Continued Strong Activity in the M&A Space
Pitchbook data reveals that $19.6 billion of capital was invested across 27 M&A transactions last week, twelve more deals but $17.2 billion less capital than in the week prior. The largest deal was publicly traded Centene’s corporate acquisition of WellCare Health Plans, also a publicly traded company, for $15.3 billion. The manufacturing vertical has been busy in 2019 through the end of last week, posting 48 transactions and $19 billion capital invested in LBOs and corporate acquisitions.
Initial Public Offerings: Lyft Follows Through with Long-Awaited IPO
According to the New York Stock Exchange website, two companies went public last week, the same figure as the week before. However, those two companies, Lyft and Precision BioSciences, combined raised more than in the prior week, raising $2.3 billion and $126 million, respectively. Lyft has been a highly anticipated IPO since the beginning of 2018, and the results of its IPO are indicative of it. The company priced its IPO at $72 per share, well above its initial estimates after a roadshow in which the firm received commitments in excess of expectations. As of trading close on Friday, Lyft was valued at approximately $26.5 billion.
Economy: U.S. Fourth Quarter Economic Growth Revised Downward
Among news last week:
Notable initial public offerings (IPOs) during the month of December 2017 included:
According to PitchBook, mergers and acquisitions (M&A) by private equity (PE) funds trended down in the third quarter of 2017 with an estimated 959 deals closed, valued at approximately $163 billion.
This is a subset of the overall M&A market, as this only includes deals by PE firms and excludes acquisitions by strategic buyers. For the first three quarters of the year, deal value and closings are both down 11% from the first three quarters of 2016. This comes as a surprise, as fundraising continues to be strong, and private equity “dry powder” (the capital that the funds have raised but not yet deployed) is at an estimated $556 billion. Fewer numbers of investments being made and lower aggregate deal value may be the effect of fewer quality deals on the market and less flexibility in price.
There were 2,362 global venture-backed deals, representing $49 billion in value, in the third quarter of 2017, according to Preqin. While this is the sixth consecutive quarter of declining transactions, the deal value in the quarter represents the second consecutive quarter of record highs, and the value through the first three quarters of 2017, at $128 billion, is on pace to become an all-time annual high. This comes as deal count through the first three quarters of 2017 are down 14% to 7,552 announcements from 2016’s 8,792. The US accounted for 40% of global deals, both in terms of volume and value.