As chairs of the ABA’s Private Target Mergers & Acquisitions Deal Points Study (the Private Target Deal Points Study), we are pleased to announce that we published the latest iteration of the study to the ABA’s website in early December 2019.
Congratulations! But Wait. What Exactly Is This Private Target Deal Points Study, Anyway?
The Private Target Deal Points Study is a publication of the Market Trends Subcommittee of the Business Law Section’s M&A Committee. It examines the prevalence of certain provisions in publicly available, private target M&A transactions during a specified time period. The Private Target Deal Points Study is the preeminent study of M&A transactions, widely utilized by practitioners, investment bankers, corporate development teams, and other advisors.
The 2019 iteration of the Private Target Deal Points Study analyzes publicly available definitive acquisition agreements for transactions executed and/or completed either during calendar year 2018 or during the first quarter of calendar year 2019. In each case, the transaction involved a private target acquired by a public buyer, with the acquisition material enough to that public buyer for the Securities and Exchange Commission to require public disclosure of the applicable definitive acquisition agreement.
The final sample examined by the Private Target Deal Points Study is made up of 151 definitive acquisition agreements and excludes agreements for transactions in which the target was in bankruptcy, reverse mergers, divisional sales, and transactions otherwise deemed inappropriate for inclusion.
Although the deals in the Private Target Deal Points Study reflect a broad array of industries, the technology and healthcare sectors together made up approximately 40 percent of the deals. Asset deals comprised 5.3 percent of the study sample, with the remainder either equity purchases or mergers.
Of the Private Target Deal Points Study sample, 34 deals signed and closed simultaneously, whereas the remaining 117 deals had a deferred closing some time after execution of the definitive purchase agreement.
The transactions analyzed in the Private Target Deal Points Study were in the “middle market,” with purchase prices ranging between $30 million and $750 million; purchase prices for most deals in the data pool were below $200 million.
The Private Target Deal Points Study Sounds Great! How Can I Get a Copy?
All members of the M&A Committee of the Business Law Section received an e-mail alert from Jessica Pearlman with a link when the study was published. If you are not currently a member of the M&A Committee but do not want to miss future e-mail alerts, committee membership is free to Business Law Section members, and you can sign up on the M&A Committee’s homepage.
The published 2019 Private Target Deal Points Study is available for download by M&A Committee members from the Market Trends Subcommittee. Also available are the most recently published versions of the other studies published by the Market Trends Subcommittee, including the Canadian Public Target M&A Deal Points Study, Carveout Transactions M&A Deal Points Study, and Strategic Buyer/Public Target M&A Deal Points Study.
How Does the 2019 Private Target Deal Points Study Differ from the Prior Version?
The 2019 version of the Private Target Deal Points Study has a number of features that differentiate it from prior iterations.
- Data in the 2019 version of the Private Target Deal Points Study is more current. The 2019 version of the Private Target Deal Points Study includes not only 2018 transactions, but also transactions from the first quarter of 2019.
- The 2019 version of the Private Target Deal Points Study contains new data points. The 2019 version of the Private Target Deal Points Study includes new data points throughout, including three new representations on #MeToo, data privacy, and cybersecurity. There are other new data points scattered throughout the study with “new data” flags (like the sample shown below) to make them easy to spot:
- The 2019 version of the Private Target Deal Points Study includes more correlations. Representations and warranties insurance (RWI) is changing the M&A game, and we are keeping score. We have added a number of data points to our correlations with deals that reference RWI and deals that do not.
Please join us in extending a hearty thank you to everyone who worked so hard on this study, from leadership to advisors to issue group leaders to the working groups, all of whom are listed in the credits pages.
For more information, register for the In the Know webinar, during which the chairs and issue group leaders will provide analysis and key takeaways from the results of the Private Target M&A Deal Points Study, on April 16, 2020, from 1:00 p.m. to 2:30 p.m. (ET).