Sluggish merger and acquisition (M&A) activity carried over into September, as just over 500 transactions were completed in the US during the month.

Despite an apparent leveling off of deals (more September deals will certainly be reported as there is a lag in reporting), preliminary data from PitchBook suggests that overall transaction value climbed roughly 60% month over month.

​In the Midwest, 14 transactions were preliminarily reported, a slight increase from August’s 11 deals. Deals in the information technology space were favored, accounting for six of the 14 completed. 

​Preliminary data from PitchBook suggests that August was a slow month for national and Midwest merger and acquisition (M&A) activity. In the US, fewer than 500 deals were completed during the month, a nearly 25% reversal of the recovery we began to see after May’s lows. Similarly, M&A activity in the Midwest fell to the lowest level of the year. However, the data may not be as dreary as a first glance shows – more than 150 deals were announced in the US during the month, estimated to account for over $110 billion in transaction value. Furthermore, the Midwest had one deal announced during the month that topped $1 billion – Waystar Health announced during the month that it would acquire Overland Park-based eSolutions for an estimated $1.35 billion.

​M&A activity continued to pick up in July, according to preliminary data from Pitchbook. In the US, there was more than $50 billion in M&A spending, the second month of increases from May’s low. While deal counts are currently showing a sequential decline from June, we suspect there will be an increase as deals are reported (there tends to be a lag in deal reporting). We continue to monitor M&A volume, which is supported by the reopening of economies across the nation but is under pressure from rising COVID-19 cases.

​After four months of large M&A deals keeping invested capital levels afloat, capital markets experienced an absolute drop off in M&A activity. According to preliminary Pitchbook data, there were only 269 deals for a total of $12.2 billion, representing a 23% and 85% decline, respectively. Compared against the same period one year ago, May’s totals are roughly half.

​As the world struggled to contain and understand the full impact of the coronavirus (COVID-19) pandemic in the first quarter, the main economic impact (see our summary here) did not manifest itself until the second half of March. It is unsurprising, given the sudden stop, that merger and acquisition (M&A) activity echoed general economic trends, particularly in light of the uncertainty surrounding how long restrictive measures would remain in place and whether there would be a “V-shaped” recovery.

​Mergers and acquisitions have decreased – or at least paused temporarily - as the coronavirus has kept businesses shuttered and dealmakers at home or focused on other matters. Deal counts are down 54% since COVID-19’s most recent peak in January and invested capital figures have remained roughly constant. Year-to-date compared with 2019, deal count is down 11.4% and total invested capital is up just 4%. 

​Merger and acquisition deal count figures continued to slide in March as COVID-19’s impact unfolded across the United States. During the month, deal count totaled 433, representing a 25.9% decline from February, while invested capital grew 0.6% to $96.4 billion. For the first quarter, deal count is down 3.11% compared with 2019, while invested capital is up 5.06%.

​A handful of large-scale M&A deals kept total spending levels afloat in February, despite declining deal count figures. During the month, there were 691 corporate M&A deals, 25% lower than January, and $123 billion in spending, which is 14% greater than the month before. Moreover, median deal size and post-valuation figures are up 21% and 35%, respectively, month over month. 

​Skyline Advisors has released its latest Capital Markets Review: Midwest Edition for 2019. The report details activity and trends for mergers and acquisitions, private equity deals, and venture capital deals for both national and Midwest geographies. Key highlights include:

• Mergers and Acquisitions: M&A value declined from a record high in 2018, reaching $1.8 billion in 2019 across more than 9,000 deals.
• Private Equity: The total value of Midwest PE deals increased 38% in 2019 to $27 billion. Meanwhile, PE fundraising topped $300 billion for the first time ever during the year.
• Venture Capital: VC value and volume nearly topped a historic 2018, with $136.5 billion spent across nearly 10,800 deals. The year was a record for VC exits, with value from exits nearly doubling 2018’s amount. Midwest activity paralleled that of the US as a whole.
• Economy: The economy continued to grow in 2019, with real GDP increasing 2.3%. However, job openings fell at the fastest pace since 2009 in December, and the coronavirus is expected to affect economic growth, with the Fed already attempting to counter its effects by decreasing the Fed Funds Rate at the beginning of March

The complimentary copy of the full report, which also contains economic data and public market data of interest to owners and managers of middle market businesses, is available here.

Skyline Advisors has released its latest Capital Markets Review: Midwest Edition for the third quarter of 2019. The report details activity and trends for mergers and acquisitions, private equity deals, and venture capital deals for both national and Midwest geographies. Key highlights include:

• National M&A: Though total US M&A deal count declined 18% from Q2, the total value of deals increased 37% in the third quarter, reaching a value of $340 billion
• Midwest M&A: Total Midwest M&A value topped $25 billion through the third quarter, led by Mutual of Omaha Bank’s $1-billion sale to CIT Group
• Private Equity: Amid economic uncertainty, PE investors deployed less capital across fewer deals in the third quarter: both nationally and in the Midwest
• PE Fundraising: Fundraising among private equity funds nearly topped all of 2018, with $191 billion raised year to date through Q3 compared to $196 billion in all of 2018
• Venture Capital: Midwest venture capitalists deployed the most capital ($263 million) in a quarter since last year and across the most investments (51 deals) in a quarter in more than three years

The 14-page report also contains economic data and public market data of interest to owners and managers of middle market businesses. Access a complimentary copy of the full report here.