It was a good year for private equity M&A with volume increasing in the U.S., according to data from Dealogic.
This year saw 1,161 U.S. announced PE deals valued at about $267.3 billion as of Dec. 30, Dealogic said. That’s up from 1,130 transactions in 2013 that totaled about $256.5 billion, the data provider said.
Worldwide PE experienced the biggest change. The number of transactions fell this year by nearly 2 percent while deal values rose nearly 33 percent. Globally, there were 2,959 announced PE-backed transactions totaling roughly $603.1 billion, Dealogic said. That compares to 3,017 PE deals in 2013 that were valued at $453.6 billion.
Global M&A was also strong. There were 40,113 announced deals in 2014 totaling about $3.6 trillion. The world’s biggest M&A deal was the internal merger of Kinder Morgan Inc. with Kinder Morgan Energy Partners, Kinder Morgan Management and El Paso Pipeline Partners. Dealogic values the transaction at $76.2 billion.
In 2014, the U.S. M&A market was notable for its high valuations and ample leverage that made it better to be a seller than a buyer. “Pricing was way high, partially driven by cheap and easy debt and partially by capital overhang,” one LP said.
One private equity executive said he hoped for a market jolt in 2015 that would normalize the M&A market “with valuations that make sense for buyers.”
The largest global PE deal was KKR’s $24.1 billion sale of its remaining stake in Alliance Boots to Walgreens.
Here are the top five U.S. private equity deals this year, according to Dealogic.
- Biomet: The year’s top U.S. PE deal was the sale of Biomet, the fourth largest provider of orthopedic products, to Zimmer Holdings in a deal valued at $13.4 billion. The sale provided an exit for PE firms Blackstone, Goldman Sachs PE group, KKR and TPG Capital, which acquired Biomet in 2007 for $11.3 billion. The PE firms made about 1.5x their money with the sale, the New York Times reported.
- PetSmart: In second place is the $8.7 billion sale of PetSmart to a PE group led by BC Partners. Other buyers included Caisse de dépôt et placement du Québec, StepStone and Longview Asset Management.
- IndCor Properties: Blackstone in December agreed to sell IndCor Properties to GIC Pte, Singapore’s sovereign wealth fund. Dealogic values the deal at $8.1 billion. IndCor owns and operates a portfolio of 117 million square feet of industrial space in markets throughout the U.S., the Wall Street Journal said.
- Athlon Energy: In fourth place is Encana’s $6.83 billion offer to buy Athlon Energy. The deal was the biggest announced purchase of a U.S. crude and natural gas producer by a Canadian company, Bloomberg News said in September. Apollo Global Management was Athlon’s largest shareholder, Bloomberg said.
- Nuveen Investments: Madison Dearborn Partners’ sale of Nuveen Investments ranked fifth for the year, Dealogic said. In October, TIAA-CREF closed its $6.25 billion buy of Nuveen Investments, the Chicago asset manager. MDP led a group of investors to buy Nuveen in 2007 for $6.3 billion.
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