December Delivered More Deals than November, but Fewer than the Last Month of 2014

Traditionally, December is a strong month for M&A, as private equity firms and strategic buyers race to close deals by the end of the year. In keeping with that phenomenon, December delivered 156 completed middle-market transactions, up slightly from November’s tally of 134, according to Thomson Reuters. Despite the increase, however, deal volume was significantly lower than the previous December, which generated 209 completed transactions.

In another sign of weakness in the middle market, December’s composite score on the Mid-Market M&A Conditions Index (MACI) indicated a contraction in dealmaking for the first time since Mergers & Acquisitions began our monthly surveys in the fall of 2013. Survey respondents cited a wide range of issues dampening deal flow, including rising interest rates, slowing economic growth, uncertainty about the upcoming elections and fears about terrorism throughout the world.

The biggest mid-market transaction to close in December was the purchase by Sensata Technologies Holding NV (NYSE: ST) of Custom Sensors & Technologies Inc. for $1 billion. “This acquisition further extends our sensing content beyond automotive markets and builds scale in pressure sensing," said Sensata CEO Martha Sullivan. The acquisition of Custom follows Sensata’s $1 billion purchase of Shrader International, which makes tire-pressure monitors, from PE firm Madison Dearborn Partners LLC, which closed in October 2014.

Below is a list of selected middle-market M&A deals completed in October 2014.

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.