AI Magazine Issue 2 2018- Boyas Drafting & Design, LLC

104 Acquisition International - Issue 2 2018 2018 has gotten off to a slow start in terms of the volume and value of mergers and acquisitions (M&A) deals targeting support services companies, according to Zephyr, the M&A database published by Bureau van Dijk. In all, there were 881 deals worth an aggregate USD 20,884 million announced during January. Should dealmaking continue on this trajectory throughout 2018, the year would be unlikely to achieve the same results as 2017, but it remains too early to know what the coming months will bring, given that we are just five days into February at the time of writing. ctivity in the support services sector in January 2018 was down on the same month in both 2017 (USD 23,440 million) and 2016 (USD 22,127 million) in terms of value. However, when compared to December 2017’s USD 18,428 million, January’s value is higher. While dealmaking did not quite reach the same heights as in the opening months of the preceding three years, it represents the first time that January has surpassed December’s value since 2015. 2017 as a whole proved to be somewhat disappointing as both volume and value declined over the 12 months to 11,838 deals worth USD 292,879 million, from 12,778 deals worth USD 394,703 million in 2016. The largest deal targeting a support services company to have been announced in 2018 to date involved SAP America agreeing to acquire Californian cloud-based sales performance management software-as-a-service provider Callidus Software for USD 2,400 million. This was followed by USACompression Partners announcing plans to pick up CDM Resource Management, a Texas-headquartered natural gas compression and treating contract service provider, for USD 1,700 million. Two other deals broke the USD 1,000 million-barrier in January. The first took the form of a USD 1,600 million takeover of US oil and natural gas midstream service provider Lucid Energy by a consortium of private equity firms such as Riverstone and Goldman Sachs, while the second involved Chinese second-hand car trading platform operator Chehaoduo Old Motor Vehicle Brokers raising USD 1,000 million in a series C round of funding. Together, these four deals accounted for 32 per cent of total value targeting companies in the support services industry in January 2018. Having been targeted in three of the top four deals so far in 2018, it comes as no surprise that North America has topped the world region rankings by both volume and value in terms of M&A targeting support services companies. The region has so far been targeted in 300 deals worth USD 12,007 million in the year to date. In terms of value, it was followed by the Far East and Central Asia with USD 6,273 million, while Western Europe came third with USD 2,901 million. By volume, the Far East and Central Asia placed a close second, with 270 deals, followed by Western Europe with 244 deals, while Eastern Europe (45), Oceania (37) and South and Central America (16) also featured. In conclusion, it is still too early to say how 2018 is likely to shape up and while results are still some way away from reaching the levels recorded throughout 2017, much encouragement can be taken from the fact that there have already been a number of high value deals targeting the support services industry announced in the year-to-date. If the following months continue to produce large deals, 2018 may be able to reach highs recorded in 2015, when 13,280 deals worth USD 371,477 million were recorded. We have seen in the past that a couple of large investments can change the course of a month or year and this could yet prove to be the case in 2018. Company: Bureau van Dijk E-Mail: [email protected] Web: www.bvdinfo.com Support Services A