Leads for New M&A Rose in February, but the Tally for Closed Deals Kept Falling

Availability of financing dropped to the lowest level since Mergers & Acquisitions began our monthly surveys in the fall of 2013

Leads for new deals rebounded in February, following the middle market’s worst January on record, but deal closings continued to fall, as did availability of financing, according to the Mid-Market M&A Conditions Index (MACI). (See related chart).

While February’s healthy scores for early-stage activities, such as leads and signed letters, may offer hope that dealmaking will pick up later in the year, the tally of completed deals continues to bode ill. The first two months of 2016 delivered just 236 closed middle-market transactions, the worst deal volume for the period since 1991, based on analyzing data from Thomson Reuters. (See the table, below, for a selected list of transactions that were completed in February.)

Also troubling was the score for availability of financing on the MACI (not shown on the chart), which dropped to 35.7, the lowest it’s been since Mergers & Acquisitions began our monthly surveys in the fall of 2013. Derived from monthly surveys of approximately 250 executives, the MACI is a diffusion index. Readings above 50 indicate expansion in M&A activity, and readings below 50 show contraction.

Participants in our survey continued to cite a wide range of macroeconomic and geopolitical concerns, from upcoming U.S. elections to potential interest rate increases, from the refugee crisis in Europe to the slowdown in China, from volatile oil prices to fears of terrorist attacks. 

Editor’s Note: To measure activity in the middle market, Mergers & Acquisitions looks at transactions that fulfill several requirements: Deals must have a value of roughly $1 billion or less; they must be completed (not just announced) within the timeframe designated; and they must include at least one U.S. company in the role of buyer and/or seller. Excluded from our charts are: recapitalizations; self tenders; exchange offers; repurchases; stake purchases; and transactions with undisclosed values, buyers or sellers. Our data provider is Thomson Reuters, which updates its databases continuously. We use the data available at press time.

Key Middle-Market M&A Deals Completed in February 2016

DateAcquirerTargetTarget IndustryValue ($mil)
02/01/16 Coty Inc Hypermarcas SA-Beauty Business Soaps, Cosmetics, and Personal-Care Products 986.0
02/04/16 Icahn Enterprises LP The PEP Boys-Manny Moe & Jack Miscellaneous Retail Trade 894.0
02/02/16 NetApp Inc SolidFire Inc Computer and Office Equipment 870.0
02/01/16 comScore Inc Rentrak Corp Business Services 813.2
02/05/16 Mattress Firm Holding Corp HMK Mattress Holdings LLC Retail Trade-Home Furnishings 780.0
02/01/16 TransCanada Corp Talen Energy Corp-Ironwood Electric, Gas, and Water Distribution 654.0
02/11/16 IHS Inc Oil Price Information Service Business Services 650.0
02/01/16 Financial Engines Inc Mutual Fund Store LLC Investment & Commodity Firms,Dealers,Exchanges 584.0
02/01/16 CACI International Inc L-3 Natl Sec Solutions Inc Business Services 550.0
02/05/16 Calpine Corp Granite Ridge Hldg-Energy Ctr Electric, Gas, and Water Distribution 500.0
02/18/16 Cipla (EU) Ltd InvaGen Pharmaceuticals Inc Drugs 500.0
02/13/16 FNB Corp,Naples,Hermitage,PA Metro Bancorp Inc,Harrisburg Commercial Banks, Bank Holding Companies 463.5
02/01/16 CST Brands Inc Flash Foods Inc Retail Trade-Food Stores 425.0
02/16/16 Gray Television Inc Schurz Commun Inc-Tv & Radio Radio and Television Broadcasting Stations 415.3
02/01/16 Mallinckrodt PLC The Medicines Co-Hemostasis Drugs 410.0
02/04/16 MAP Fee Owner LLC Brandywine Rlty Tr-Office Real Estate; Mortgage Bankers and Brokers 398.1
02/24/16 RREEF Funds LLC West 8th,Seattle,Washington Real Estate; Mortgage Bankers and Brokers 370.0
02/10/16 Astellas Pharma Inc Ocata Therapeutics Inc Drugs 362.7
02/01/16 Kinder Morgan Inc BP Products NA-Terminals(15) Oil and Gas; Petroleum Refining 350.0
02/02/16 Securitas AB Diebold Inc-Business Electronic and Electrical Equipment 350.0
02/01/16 ArcLight Capital Partners LLC TransMontaigne GP LLC Oil and Gas; Petroleum Refining 350.0
02/23/16 Comtech Telecommun Corp TeleCommunication Systems Inc Prepackaged Software 329.7
02/04/16 Honeywell International Inc COM DEV International Ltd Electronic and Electrical Equipment 308.4
02/26/16 Computer Sciences Corp UXC Ltd Business Services 296.7
02/01/16 Hudson's Bay Co Gilt Groupe Inc Miscellaneous Retail Trade 250.0
02/03/16 Cubic Corp GATR Technologies Inc Communications Equipment 232.5
02/08/16 Prestige Brands Holdings Inc DenTek Oral Care Inc Soaps, Cosmetics, and Personal-Care Products 225.0
02/03/16 Investor Group Resolution Ppty-Designer Real Estate; Mortgage Bankers and Brokers 218.6
02/03/16 Endologix Inc TriVascular Technologies Inc Measuring, Medical, Photo Equipment; Clocks 202.8
02/08/16 DRA Advisors LLC Triangle Town Ctr Real Estate; Mortgage Bankers and Brokers 174.0
02/05/16 AMETEK Inc Brookfield Engineering Labs Measuring, Medical, Photo Equipment; Clocks 167.0
02/02/16 The Michaels Companies Inc Lamrite West Inc Retail Trade-General Merchandise and Apparel 150.0
02/05/16 Halma PLC CenTrak Inc Measuring, Medical, Photo Equipment; Clocks 140.0
02/02/16 Hillenbrand Inc Red Valve Co Inc Metal and Metal Products 131.9
02/01/16 Westmoreland Coal Co BHP Billiton Ltd-San Juan Mine Mining 127.0
02/05/16 Pozen Inc Tribute Pharm Canada Inc Drugs 125.2
02/01/16 Pacific Premier Bancorp Inc Security California Bancorp Commercial Banks, Bank Holding Companies 118.9
02/01/16 Balchem Corp Albion Laboratories Inc Drugs 111.5
02/15/16 Investor Group Lion Walk Shopping Centre Real Estate; Mortgage Bankers and Brokers 110.4
02/16/16 PGT Inc WinDoor Inc Metal and Metal Products 105.0
02/01/16 Hooker Furniture Corp Home Meridian Intl Inc Wood Products, Furniture, and Fixtures 100.0
02/25/16 Scripps Networks Interactive The Travel Channel LLC Radio and Television Broadcasting Stations 99.0
02/08/16 Gateway Realty Holdings Ltd Multi-family Properties,CT Real Estate; Mortgage Bankers and Brokers 92.5
02/18/16 Aegion Corp Underground Solutions Inc Construction Firms 85.0
02/08/16 Heartland Financial USA Inc CIC Bancshares Inc Commercial Banks, Bank Holding Companies 83.5
02/19/16 RBB Bancorp TFC Holding Co Commercial Banks, Bank Holding Companies 83.3
02/01/16 A&B Properties Inc Manoa Marketplace Real Estate; Mortgage Bankers and Brokers 82.4
02/03/16 PolyOne Corp Kraton Performance-Business Rubber and Miscellaneous Plastic Products 72.0
02/04/16 Xylem Inc Tideland Signal Corp Measuring, Medical, Photo Equipment; Clocks 69.0
02/01/16 Homestreet Inc Orange County Business Bank Commercial Banks, Bank Holding Companies 62.7
02/18/16 Cipla (EU) Ltd Exelan Pharmaceuticals Inc Wholesale Trade-Nondurable Goods 50.0
02/25/16 MindTree Ltd Magnet 360 LLC Business Services 50.0
02/08/16 Infoblox Inc IID Business Services 45.0
02/01/16 II-VI Inc EpiWorks Inc Electronic and Electrical Equipment 43.0
02/02/16 Tower Semiconductor Ltd Maxim Integrated Prod-fabricat Electronic and Electrical Equipment 40.0
02/01/16 Larkin Community Hospital Palm Springs General Hospital Health Services 40.0
02/03/16 Clean Harbors Inc Vertex Energy Inc-Re-Refinery Sanitary Services 35.0
02/10/16 Constellation Healthcare Tech MDRx Enterprises Inc Health Services 30.0
02/12/16 Driftwood Hospitality Mgmt LLC Saratoga Hilton,New York Hotels and Casinos 30.0
02/02/16 Synoptek Inc EarthLink-IT Services Business Business Services 29.0
02/09/16 CieNA Healthcare Mgmt Inc Laurel Health Care Co Health Services 25.8
02/18/16 KeepItSafe Inc InterCloud Sys Inc-Online Business Services 24.0
02/12/16 Argosy Private Equity Nationwide Industries Inc Metal and Metal Products 22.5
02/25/16 Investor Group APR Energy PLC Electric, Gas, and Water Distribution 20.5
02/08/16 Flamel Technologies SA FSC Holdings LLC Investment & Commodity Firms,Dealers,Exchanges 20.3
02/10/16 AiNet One Market Center,Baltimore,MD Business Services 20.0
02/08/16 Perk.com Inc Viggle Inc-Viggle Business Prepackaged Software 19.7
02/01/16 Sevcon Inc BASSI Srl Electronic and Electrical Equipment 19.0
02/04/16 Merit Medical Systems Inc CryoLife Inc-HeRO Graft Measuring, Medical, Photo Equipment; Clocks 18.5
02/08/16 Addus HealthCare Inc S Shore Home Health Svcs Inc Health Services 18.0
02/08/16 GTT Communications Inc Telnes Broadband Business Services 18.0
02/01/16 CLARCOR Inc TDC Filter Mnfg Inc-Asts Machinery 11.0
02/02/16 Carter Validus Mission Waco Data Center Business Services 10.7
02/16/16 ID Global Solutions Corp FIN Holdings Inc Prepackaged Software 9.0
02/22/16 Industrias Bachoco SAB De CV Amer Foods Grp LLC-Fully Food and Kindred Products 8.0
02/11/16 Consolidated Water Co Ltd Aerex Industries Inc Machinery 7.7
02/01/16 Acme United Corp Vogel Capital Inc Machinery 7.0
02/04/16 Perma-Pipe Inc Bayou Perma-Pipe Canada Ltd Chemicals and Allied Products 6.5
02/01/16 CareTrust REIT Inc New Haven,San Angelo,Texas Health Services 4.9
02/18/16 Gen-Probe Inc DiagnoCure Inc-PCA3 prostate Drugs 4.0
02/01/16 XG Technology Inc Integrated Microwave Tech LLC Communications Equipment 3.0
02/09/16 Almirall SA Thermigen LLC Measuring, Medical, Photo Equipment; Clocks 2.5
02/22/16 Iron Tank Resources Corp Spriza Inc Business Services 1.7
02/18/16 Investor Group CXR Anderson Jacobson SAS Wholesale Trade-Durable Goods 1.3
02/01/16 New Jersey Mining Co Butte Highlands JV LLC Mining 0.4
02/02/16 AHAlife Holdings Ltd Bezar Inc Business Services 0.2
02/10/16 Halitron Inc PRD Holdings Inc Rubber and Miscellaneous Plastic Products 0.2
02/12/16 Luxor Industrial Corp Mill Frame LLC Construction Firms 0.1
02/04/16 David Lelong Sport Endurance Inc Retail Trade-Food Stores 0.1
Source: Thomson Reuters        

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