Cross-Border Bulletin: Global M&A Transactions Impacting The U.S.
The first half of 2021 continued the exuberance in global cross-border M&A from the second half of 2020. Global cross-border M&A volumes nearly tripled to $567B compared to the H1 2020, as strategic and financial acquirors participated in the global post-pandemic economic recovery. Several factors, including the continued low interest rates, improved outlook on the COVID-19 pandemic and record corporate cash balances contributed to increased activity. The pace of large acquisitions increased, reminiscent of the pre-financial crisis. 13% of global cross-border M&A transactions were valued above $1B. U.S.-listed SPACs, which we predicted in our last issue would ramp their search for targets abroad, accounted for two of the five largest cross-border deals by volume to date (Thoma Bravo’s $11B acquisition of ironSource and Altimeter Growth’s $35B acquisition of Grab Holdings). With over $124B of cash in trust still outstanding, we expect even more cross-border SPAC activity in H2 2021.
While the deal-making environment continues to be favorable, there are a few headwinds that could temper enthusiasm. Nascent fears about inflation, which would increase financing costs for acquirors, are forming as the U.S. economy recovers from the COVID-19 lockdowns and disruption. Anticipated U.S. corporate tax rate hikes and increased antitrust scrutiny may also impede future cross-border M&A activity.
Particular themes discussed in this issue include:
- Japanese Corporations Upgrade Their Software
- PE Takes Its Shot With Professional Sports
- Country Focus: Singapore
- Sector Focus: Warehousing & Logistics