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In the 10th anniversary year of the European M&A Awards, we recognise the most influential M&A deal of the past decade.
One morning in November, our team of editors locked themselves in the boardroom to take a look back through the archives. Their task was to use decades of experience in deal journalism to select a list of five M&A deals that could be crowned “deal of the decade” at this year’s Mergermarket M&A Awards.
“We considered the significance of each of these deals in the context of the last 10 years,” says Lucinda Guthrie, Deputy Global Editor at Dealreporter. “In some instances, CEOs had waited years to make an approach, whereas others were bold bets on the future of industries or demonstrated incredible dealcraft to get the deal through.”
This special award has been created to celebrate the 10th edition of Mergermarket’s European M&A Awards, an event that has recognised leading M&A advisors since 2007. The winner will be picked by a live audience vote on the night of Thursday 8 December 2016 by the region’s top 300 financial and legal advisers who attend.
“The shortlist of deals that we’ve picked represent the most active industry sectors for M&A throughout the last decade – energy, consumer, telecoms, private equity and industrials,” said Giovanni Amodeo, Global Editor-in-Chief of Mergermarket. “Some of them were transformational for the company, incredibly complex or just fascinating to report on.”
Deal of the decade contenders
KKR’s Exit of Boots
In April 2007, KKR and Stefano Pessina acquired Alliance Boots in a deal worth £12bn, the largest European LBO of the last 10 years. More than £8bn of debt is used to finance the deal which represented the first private equity buyout of a FTSE 100 company. Walgreens bought Alliance Boots for a combined deal value of £18.4bn across two stake acquisitions in 2012 and 2014, making it also the largest private equity exit of the past decade.
Shell's purchase of BG Group
Last year, Shell announced the purchase of BG Group; a deal which completed in February this year. At £54.5bn, it is the largest energy deal of the past decade and an acquisition that was 15 years in the making according to Shells’ former CEO, Jeroen van der Veer. The collapse in oil prices last year raised questions over the valuation but shareholders believed that the price was worth paying for a transformational opportunity. They might have been right. As Shell’s latest earnings show, the deal is already paying off. For its timing and strategic importance, Shell/BG Group makes the shortlist.
Merger of Holcim and Lafarge
In April 2014, two heavyweights in global construction came together in the largest industrials sector deal of the past decade. The deal raised competition concerns which prompted antitrust filings across the globe. A wave of disposals was announced which provided a string of new M&A mandates for advisors. It was reported that boardroom spats took the deal to the brink and advisors had to think on their feet to salvage the deal. It makes the shortlist due to the incredibly complex combination of two European strategic giants.
Verizon Wireless sold by Vodafone
During a decade of telecoms consolidation, Vodafone disposed of its Verizon Wireless stake and brought to a close Vodafone’s era of acquisitions. It was reported that Vodafone’s Vittorio Colao and Verizon Communication’s Lowell McAdam thrashed out the deal down the gym and the two CEOs agreed on the disposal whilst watching a New York Rangers ice hockey game together. For a deal value of £80bn, it is the largest telecoms deal of the past 10 years.
Kraft's hostile bid for Cadbury
Kraft made a hostile bid for Cadbury at the height of the credit crunch. It was a deal that changed the process for UK takeovers and is a firm fixture in business school textbooks. Although Cadbury’s defence strategy forced higher bids, it is hedge funds who are the big winners and Kraft break its promises. The deal was a catalyst for post-crisis deals and a new Takeover Code. This makes it hugely influential for the UK, the most active M&A market in the region.
Deal of the decade will be announced at Mergermarket’s European M&A Awards on Thursday 8 December 2016.