On the Hunt: Are the Big Pieces of 2015’s M&A Puzzle yet to be Placed?
In a previous post, we discussed the year of the megadeals and explored the motivation behind these acquisitions. Although 2015 has seen historical M&A movement, several big players are still indicating their intentions to undertake the next wave of M&A activity.
With only weeks left until the end of the year, are the big pieces of 2015’s M&A puzzle yet to be placed or will 2016 bring new records? We investigate the rumours and look ahead to what the next 12 months might bring.
In March 2015 the parent company of British Airways, Iberia and Vueling, IAG SA, denied all interest in plans to expand the company. However, October this year saw the acquisition of the Irish airline company Aer Lingus. Similar comment about its prospective move into the Asian market has also been made, with IAG’s Chief Executive, Willie Walsh, recorded as saying that expansion into the Far East posed “significant challenges” and that he would prefer to leave consolidations to those who “knew the market better or who are braver”.
Naturally these denials raise suspicion of precisely what strategic path IAG plans to go down as it is already rumoured to be on the lookout for additional acquisitions. Based on revenue alone, IAG is currently the third largest company in Europe and the sixth largest in the world and, rumour has it, the company is looking not only to expand into the Far East and Africa, but also Scandinavia and some of the former Soviet Republics.
New Jersey-based B&G Foods recently participated in its first acquisition under new president and CEO, Bob Cantwell, namely the $765 million purchase of the Green Giant business from General Mills.
Positioned at number 53 on the Forbes list of ‘America’s Best Small Companies’, B&G manufactures, sells and distributes a wide range of food goods and household products in America, Canada and Puerto Rico. Mr Cantwell is already gearing up for the next acquisition opportunity but will not be specific about any future direction. However, he has commented that development into the frozen food market will “open many future growth opportunities”.
B&G faces marketing challenges with the Green Giant brand, as the trend for tinned and frozen vegetables is less favoured in comparison to freshly-prepared options. Yet, Mr Cantwell stressed it would be taking a new approach to branding and highlighted that any future acquisitions or opportunities would have to “make sense” for B&G.
Private Equity firm Blackstone recently completed an $8 billion acquisition of BioMed Reality Trust Inc., a leading provider of real estate to the life science community in the US and UK. Blackstone’s portfolio, which already includes Hilton Worldwide, Merlin Entertainments and SeaWorld Parks & Entertainment, will be enhanced by the acquisition of BioMed which was described by Blackstone’s co-head of US real estate acquisitions, Nadeem Meghji, as a ‘best-in-class’ company.
When considering the future, commercial real estate is high on Blackstone’s list of potential targets, particularly in Southern Europe where distress sales caused by the collapse of the Eurozone have created significant investment opportunities.
With representation throughout the Americas, Europe, Africa and Asia, Benchmark International can connect you with the right opportunity. To find out more, visit www.benchmarkcorporate.com.