The first Canadian issue of the monthly executive brief providing M&A market insight for C-level management and their professional advisors.
Through the first three quarters of 2011, the United States and Canada have combined to account for 45% of the world’s M&A business. Cross border transactions between our two nations have shown a strong increase from 2010 to 2011. The United States is the largest acquirer of Canadian companies and through the third quarter 2011 was the acquirer on 38% of Canada’s M&A deals. The United States is also the largest target market for Canadian acquirers at 53% of the total transactions.
So, which industry sectors have been active and are likely to see continued activity on both sides of the border? Canadian acquisitions have focused on healthcare, multi-sector industries and real estate. US acquirers are still betting on steel, machinery, mining and energy. Other industries that are of interest include diversified financials, technology and media.
There are a number of factors contributing to the increase in cross border deals. Of late, the Canadian economy has been less volatile than that of the US. It has been less impacted by housing prices and the housing market in general. The strengthening Canadian currency relative to the US Dollar and a weaker US economy has made investment in US companies a sound business choice. US acquisition targets, both large and small, are abundant and span a wide range of business sectors for buyers to select from. Another key attraction to the US deal market is the availability of commercially reasonable deal capital.
The bottom line…scope, scale and capital have kept the deal fires burning and we see no signs they’re burning out anytime soon.
For additional information contact:
Douglas Nix, CA | Vice Chairman
Corporate Finance Associates | Toronto West | 905-845-4340 x211 | firstname.lastname@example.org