2014 H1 Global Deal values break USD 2bn – 7 years in the making

Seven years is a long time in anyone’s book. There have been a number of seven year wars, there’s the hypothetical seven year itch and the myth that it takes seven years for chewing gum to be fully digested should you swallow it! But now finally after 7 years global announced deals have broken the USD 2 trillion dollar figure in a six month period for the first time since H2 2008, when deal activity was most definitely on its way down rather than up.

This is great news and surely brings relief to those of us who since the end of the global recession have been talking about the fact that all the components for high levels of deal making are in place, only to find that we have been looking back on another false dawn at the end of each half year, quarter or year (delete to suit!).

Whilst the numbers would suggest that completions are still relatively hard work and are taking more time, values of completed deals in H1 2014 reached USD 1.92 trillion, the highest level since H1 2010, when the figure was USD 2.2 trillion in the first half of the year. The first half of 2014 has seen five deals announced that have been valued at greater than USD 20bn, with the largest deal of the year so far being the public takeover of Time Warner Cable by Comcast, valued at just under USD 69bn.

Global Private Equity continues to play its part in driving deal activity, with over USD 202bn deal value announced in H1 2014 and this representing the 6th consecutive half year with upward growth. The largest PE deal announced so far this year is the ongoing USD 11.1bn acquisition of Safeway by Cerberus Capital. However this deal is followed by a further 49 deals where the purchase price that the PE buyer is prepared to pay is greater than USD 1bn. So clear evidence that PE is back and actively willing to spend and spend big on the right target.

So the longest day of the year may have passed, but there would appear to be good reason to be cheerful about what lies ahead of us from a deal making perspective in 2014.