When it comes to deals with price tags of $1 billion and below, 2013 presented several trends for pros to follow. Along the way there were several standout transactions that presented clues to what the 2014 M&A landscape will look like. Here are the deals that shined in chronological order.
JANUARY: Avis Budget Group Inc.'s (Nasdaq: CAR) $512.5 million purchase of Zipcar Inc. came at a time when U.S. car rental companies saw a resurgence in travel spending by both domestic and foreign consumers. The deal also shows the current competitiveness of the car rental market, pitting Avis against the rental businesses of rivals Hertz Global Holdings Inc. (NYSE: HTZ) and Enterprise Rent-A-Car. Buying Zipcar, a Cambridge, Mass.-based provider of auto-sharing services, came just months after Hertz paid $2.3 billion for Dollar Thrifty Automotive Group Inc. (NYSE: DTG).
APRIL: Companies in the financial services, insurance and real estate (FIRE) industry have been targets of M&A, as buyers look to take advantage of lower valuations and gain market share. Two buyers that exemplify this trend are Carlyle Group (NYSE: CG) and Stone Point Capital LLC, which teamed up to buy New York-based Duff & Phelps Corp. in an all-cash transaction valued at $665.5 million.
MAY: The $365 million purchase of Fisher Communications Inc. by Sinclair Broadcast Group underscores the uptick in M&A activity across the broadcasting sector, which is bound to see more consolidation due to increased spending on the part of advertisers.
JUNE: Yahoo Inc.'s (Nasdaq: YHOO) fourth biggest purchase, New York microblogging service Tumblr Inc., sums up several trends in tech dealmaking. It capitalizes on the growing use of mobile devices and, by bringing in entrepreneur David Karp, demonstrates the move toward talent acquisitions, which lies at the heart of CEO Marissa Mayer's M&A strategy.
VMG Partners. sold Sea Cliff, N.Y.-based portfolio company Robert's American Gourmet Food LLC - maker of Pirate's Booty - for $195 million to B&G Foods Inc. (NYSE: BGS) for $195 million, spotlighting how the better-for-you food sub-sector is flourishing. Shortly after, B&G paid $57.5 million for granola bar maker Rickland Orchards from Natural Instincts LLC.
The $403 million purchase of MakerBot Industries LLC by Stratasys Ltd. underscores the heightened activity in 3-D printing. Stratasys, a maker of printers that can create three-dimensional objects, believes the industry is poised for growth as the sector improves the manufacturing process for products across all sectors.
JULY: Samsung Electronics Co.'s purchase of New York startup Boxee for an undisclosed price signified the continuing land-grab of products that enhance user experiences on the Web. Boxee makes video-streaming applications for phones and tablets, which helps Samsung compete in television development.
AUGUST: Johnson & Johnson (NYSE: JNJ) finalized the largest mid-market deal in the third quarter when it bought Aragon Pharmaceuticals Inc. for $1 billion. The deal helped New Brunswick, N.J.-based J&J gain control of a prostate cancer drug at a time when companies scramble to find the next-generation of medicines.
OCTOBER: Greenwich, Conn.-based First Reserve Corp., winner of the 2011 M&A Mid-Market Award for Best Private Equity firm, agreed to acquire TNT Crane & Rigging Inc. from Odyssey Investment Partners. TNT is a provider of lifting services and equipment to the North American energy and industrial infrastructure end markets which have seen a spike in dealmaking.
DECEMBER: Leonard Green & Partners LP agreed to buy Lucky Brand Jeans from Fifth & Pacific Cos. Inc. (NYSE: FNP) for $225 million, highlighting the demand for time-tested retail brands, namely when it comes to denim. The Lucky Brand deal also leaves Fifth & Pacific with only one remaining brand - Kate Spade.