Value increase for mergers and acquisitions
THE total value of mergers and acquisitions in Guernsey over the first half of 2019 rose when compared to the previous six months.
A report released by offshore law firm Appleby shows Guernsey has bucked a general trend of declining deal value across the offshore sector as a whole.
While offshore overall recorded its busiest first half for M&A over the past five years, deal value was down on previous comparable periods due to a rise in minority-stake investments.
‘Guernsey had a strong first half of the year for local deal-making, recording a modest increase in deal value over the second half of 2018,’ said Wendy Benjamin, group partner at Appleby (Guernsey) LLP. ‘The rise in deal value was due in part to the $889m. acquisition of the global payments technology company SafeCharge, the largest local transaction of 2019 to date.’
Guernsey recorded 60 deals in the first six months of 2019, worth a cumulative $4.7bn. While deal volume was down when compared to the second half of 2018, value was up 4%. The Crown Dependencies had a healthy start to the year, with the Isle of Man and Jersey seeing a rise in deal volume over the second half of 2018 of 64% and 11% respectively. There were 1,514 transactions across the offshore region in the first half of 2019, accounting for $120.4bn in value. This represents a drop when compared to recent half-year periods due largely to fewer acquisitions and billion-dollar-plus deals in the first half of 2019.
‘The 10 biggest offshore deals this year reflect the more cautious environment we’re seeing in 2019,’ said Cameron Adderley, partner and global head of corporate at Appleby. ‘Last year, the 10 largest deals were each worth well over $4bn, but there have only been three of that size so far this year. These mega-deals typically originate from China or the US and have been curtailed largely in the face of trade wars, risk uncertainty and national security issues.’
The US and China remained the leading investors into offshore jurisdictions. Significant activity also came from the UK, Norway and France and Taiwan and Singapore. Intra-offshore deals involving an offshore target and acquirer remained popular.