Global M&A activity picking up: PwC

KOLKATA: Global M&A activity has been increasing with a recovery in the metals sector post the 2009 slump and stake sales in India leading the trend, said a report by global consulting giant PricewaterhouseCoopers.

Total deal value topped $27 billion in 2010 even as the $1.02-billion JSW Steel-JFE deal emerged as the sixth largest such transaction. Pending deal flows indicate the deal sizes are only expected to get bigger in 2011, said the report adding that recovery in demand due to lesser economic uncertainty and higher market share by companies with healthier balance would be some of the reasons.

The total value of the top five deals announced in 2010 or early 2011 anticipated to be completed during the year, have crossed $17 billion. This indicates a 60% rise in size over the top five deals in 2010 that were worth $10.6 billion.

The top 10 deals in 2010 were Posco-Daewoo International ($2.8 billion), Vale-BRG Resources ($2.5 billion), Sumitomo-Mineracao ($1.93 billion), Tangshan-Handan ($1.68 billion), Gerdau Steel-Gerdau Ameristeel ($1.6 billion), JFE Steel-JSW Steel ($1.02 billion), OneSteel-AltaSteel ($932 million), Mitsubishi-Cia Minera ($924 million), Tangshan-Chengde Xinxin ($826 million) and Eurasian Natural Resources-Bahia Minerals ($735 million). "With commodity prices rising the dominant concern was raw material security for metal companies," said PwC.