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Monthly M&A InsIderA mergermArket report on globAl m&A Activity

october 2010

Monthly M&A InsIdermergermarket

GlobAl overvIew 01

AmericAs: lAtin AmericA 05

north AmericA 12

AsiA-pAcific 22

europe 32

middle eAst & AfricA 42

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CONTENTS

Monthly M&A Insider

globAl overvieW

01

CVC’s acquisition of Germany’s Sunrise Communications is a great example of the financial muscle that financial sponsors are once again flexing. Deal flow stemming from private equity funds is expected to increase further, as a number of portfolio companies, particularly in Germany, are reaching maturity and pressure on private equity investments to return funds increases. Industry experts are predicting that many of those portfolio businesses will find new homes with other private equity funds, as the original backers turn to secondary-buyouts to assure returns on investments.

In Europe, the Energy, Mining & Utilities space continues to dominate proceedings with the blockbuster International Power/GDF Suez Energy International deal grabbing the headlines. The deal, worth close to €21.00bn, was the talk of the town all through the summer, and the sector, spurred by the seemingly endless drive of Chinese companies looking to secure energy resources, is still seeing high levels of activity. Most recently, a conglomerate of Hong Kong-base energy players made up of Cheung Kong Infrastructure; Hongkong Electric Holdings; and businesses associated to the powerful Hong Kong investor Li Ka Shing; forked out just under €7.00bn to acquire the UK-based distribution network of French power giant Electricite de France SA.

The space is, naturally, also hot in Asia; however, it was the Financial Services space that saw the largest deal in the reporting period with Ping An Insurance acquiring a 31.97% stake in Shenzhen Development Bank. China’s banks have long been active in the region, after initially doing deals to

further strengthen their footprint and services, but Chinese investors are now looking further afield to do deals; experts predict that soon, they will be increasingly looking toward Europe for opportunities. In fact, the Financial Times recently quoted Xiao Gang, the Chairman of the Bank of China, as encouraging Chinese banks to look for deals overseas. His comments suggest a possible shift in Chinese government policy towards allowing local banks to undertake such deals, after putting a virtual ban on them in them in the aftermath of the financial crisis.

Meanwhile in the US, the Consumer and Leisure spaces are receiving a much needed boost with the takeover of two household brands - fast-food lovers will anxiously be watching the menu to see what changes Burger King’s new owner, 3G Capital, will be making after the private equity funds paid US$9.10bn to take control of the burger seller. At the same time, UK-based consumer giant, Unilever, paid US$3.80bn to take control of Alberto-Culver Company, guarantor of soft skin, courtesy of St Ives, and shiny hair, thanks to TRESemme.

As the winter is setting in and the year-end if fast approaching, we will keep tabs on deal flow to see how the year will close and what trends we can predict for 2011.

GLOBAL OVERVIEw

head of research – Elias Latsis

editor – Rory McNeil

For advertising opportunities contact:

erik wickman

tel: + (1) 212 6863329

[email protected]

Global overview: Catherine Ford

latin America: Mathew Albert

north America: Svetlana Alkayeva, Allen Chan and Urna Chakraborty

Asia-Pacific: Shansuke Okano, Marco Shek, and Maggie Cheung

europe: Samuel Tedjasukmana and Giovanni Gallorini

Middle east & Africa: Marie-Laure Keyrouz

GlobAl overvIew

AT THE BEGINNING OF THE FINAL qUARTER OF 2010, GLOBAL DEALMAKERS ARE KEEPING THE PACE OF THE RECOVERy GOING wITH M&A ACTIVITy CONTINUING TO MAKE A SLOw AND STEADy COMEBACK. wHILE TRADE PLAyERS ARE ACKNOwLEDGED TO BE THE DRIVING FORCE BEHIND THE RESURGENCE IN DEALMAKING, MARKET PARTICIPANTS AND OBSERVERS ALIKE HAVE BEEN SURPRISED By THE STRONG SHOwING OF PRIVATE EqUITy FUNDS, wITH A NUMBER OF LARGE BUy-OUTS TAKING PLACE.

Monthly M&A Insider 02

globAl overvieW

TREND GRAPHS

GlobAl M&A quArterly trend

VALUE VOLUME

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Valu

e (U

S$m

)

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Num

ber

of d

eals

GlobAl M&A quArterly MId-MArket trend

VALUE VOLUME

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Valu

e (U

S$m

)

0

500

1,000

1,500

2,000

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Num

ber

of d

eals

Moving average trend line


globAl overvieW

TREND GRAPHS

GlobAl M&A sector breAkdown ytd 2010

VALUE VOLUME

8.1%

6.5%

16.2%

10.9%

3.5%1.3%

2.1%

0.8%0.4%

2.6%

12.9%

26.1%

8.6%

Industrials & Chemicals

TMT

Consumer

Business Services

Energy, Mining & Utilities

Financial Services

Pharma, Medical & Biotech

Construction

Leisure

Transportation

Real Estate

Agriculture

Defence


TMT

Consumer

Business Services


Financial Services


Construction

Leisure

Transportation

Real Estate

Agriculture

Defence

12.3%

15.3%

17.7%

4.0%

3.4%

2.2%

2.9%

0.5%1.2%

11.0%

10.4%

11.7%

7.5%

GlobAl M&A quArterly PrIvAte equIty trend

VALUE VOLUME

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Valu

e (U

S$m

)

Global buyouts

Global exits

0

100

200

300

400

500

600

700

800

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Num

ber

of d

eals

Global buyouts

Global exits


globAl overvieW

TREND GRAPHS

GlobAl M&A deAl sIze breAkdown

VALUE VOLUME

0

500

1,000

1,500

2,000

2,500

H210*

H110

H209

H109

H208

H108

H207

H107

H206

H106

H205

H105

H204

H104

> US$501m

US$251m-US$500m

US$101m-US$250m

US$15m-US$100m

US$5m-US$14.9m

Valu

e (U

S$bn

)

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

H210*

H110

H209

H109

H208

H108

H207

H107

H206

H106

H205

H105

H204

H104

> US$501m

US$251m-US$500m

US$101m-US$250m

US$15m-US$100m

US$5m-US$14.9m

Value not disclosed

Num

ber

of d

eals

LATIN AM

ERICA

LATIN AMERICAA MERgERMARkET M&A REpoRT oN


In the Latin American M&A market, Brazil’s extractive industries also led the region in September as acquirers scrambled to get a foothold in the country’s booming Mining sector. In the month, the country saw a trio of transactions lead the top regional deals table. The transactions, all of which were cross-border plays with foreign investors on the buy-side, underline the country’s position as a leading supplier of natural resources to overseas markets.

In the largest deal, Sumitomo Corporation, the Japanese conglomerate active in the metals market, brokered a 30.00% stake acquisition in Mineração Usiminas (MUSA), an iron ore mining outfit based in Belo Horizonte, from Usinas Siderúrgicas for US$1.35bn with a possible earnout of US$579m subject to an increase in current iron ore reserves and the development of a port alternative for exportation of the product. Accordingly, MUSA will invest the proceeds into mining operations in Minas gerais and port facilities in Rio de Janeiro.

Elsewhere, other top monthly deals saw South korea’s Sk Networks, one of the country’s largest conglomerates, agree to acquire a 15.30% stake in MMX Mineração e Metálicos in a transaction valued at US$699m, while the British-based Eurasian Natural Resources is set to acquire the remaining 50.00% stake it does not already own in Bahia Mineração for a cash consideration of US$670m.

The flood of foreign investment into Brazil in 2010, even against the backdrop of fast-approaching national elections due in october, is a bet of confidence in the country. At the same time, the investment environment in other Latin American countries appears less auspicious - for instance, one of the largest M&A transactions in Venezuela this year saw the government finalise an agreement to pay Switzerland’s Holcim Ltd US$650m for assets seized in 2008.

Casting a look to Q3 2010 as a whole, the number of transactions coming to market remained fairly buoyant with Latin American M&A down by a modest 2.0% quarter on quarter in volume terms, compared to a sharper 5.7% fall for the M&A deal announcements globally - normally, slowdowns in Q3 reflect the seasonal effects of the summer holiday season in the Northern Hemisphere, rather than a faltering recovery in M&A activity.

Looking ahead, the improving macroeconomic environment in the larger economies of the region should provide fertile ground for deal making in Q4. The region has already seen the announcement of a US$7.11bn Energy transaction with Sinopec moving to acquire a 40.00% stake in Repsol Brazil. There will be some fiscal rectitude in the larger regional economies, but not the swingeing budget cuts coming due in the US, Western Europe and elsewhere. The affects this has on economic growth and corporate profitability in these markets is still uncertain. However, the outcome is likely to swing both ways on outbound deal flow to Latin America with hard-hit firms cutting back on cross-border M&A investment, while others push ahead into fast-growing markets of the region to offset slumping activity at home.

IN SEpTEMBER, THERE WAS No BIggER CoRpoRATE fINANCE SToRy gLoBALLy THAN THE Ipo of pETRoBRAS, BRAzIL’S STATE-oWNEd ENERgy CoMpANy, WHICH RAkEd IN A HEfTy US$70BN, MAkINg IT THE WoRLd’S LARgEST EVER fLoTATIoN. THE SUCCESS of THE SHARE offERINg WAS No doUBT BoLSTEREd By dISCoVERIES of EXpANSIVE offSHoRE oIL RESERVES IN RECENT yEARS ANd INVESToR BULLISHNESS ToWARd THE CoUNTRy’S BooMINg ECoNoMy, EXpECTEd To gRoW IN EXCESS of 7.0% IN 2010.

06

LATIN AM

ERICA

Monthly M&A Insider

Target: Mineracao Usiminas SA (30.00% stake) Announced: 28-Sep-10

Bidder: Sumitomo Corporation Deal value: US$1.35bn

Seller: Usinas Siderugicas de Minas gerais Deal nature: Acquisition, Cross-border, private

STRUCTURE• Sumitomo Corporation has signed a definitive agreement

to acquire a 30.00% stake in Mineracao Usiminas SA from Usinas Siderurgicas de Minas gerais for a total cash consideration of US$1.35bn.

• Mineracao Usiminas SA, a Brazil-based company headquartered in Belo Horizonte, is the owner and operator of iron ore mines.

• Sumitomo Corporation, a listed Japan-based company headquartered in Tokyo, is engaged in diversified business activities.

• Usinas Siderurgicas de Minas gerais, the listed Brazil-based company headquartered in Belo Horizonte, is a steel producer.

TERMS• Cash consideration of US$1.35bn.

• An earn out of US$579m will be paid, subject to the confirmation of future events, and related to the increase in current reserves of iron ore of Mineracao Usiminas and the effective development of a port alternative for export of iron ore produced by Mineracao Usiminas.

RATIONALE• The transaction is inline with Sumitomo’s strategy of

expanding its natural resources and energy business by participating in Usimina’s existing iron ore mining operations and their expansion.

EXPECTED COMPLETION• The transaction is expected to close before 11-Apr-11.

CONDITIONS • obtaining governmental authorization.

BACKGROUNDIn Jun-2010, Usiminas transferred its mining and logistics assets to Mineracao Usiminas SA, a new incorporated company. The transfer will include:

• All iron ore mining assets owned by Usiminas in the region of Serra Azul of the state of Minas gerais.

• A portion of the shares of MRS Logistica SA held by Usiminas.

• Land adjacent to the port of Itaguai in the state of Rio de Janeiro.

• Equity ownership stakes held by Usiminas in iron ore loading terminals near Serra Azul region.

dEAL of THE MoNTH

Advisors

Target/Seller Bidder

Financial Financial

Financial Legal Morrison & foerster

07

LATIN AM

ERICA

Monthly M&A Insider

TOP 15 LATIN AMERICAN ANNOUNCED DEALS YTD 30-SEP-10Announced Status Target company Sector Bidder company Seller company Exit multiples (x) Bid premia

1-day before

Deal value

(US$m)Revenue EBITDA P/E

13-Jan-10 C Carso global Telecom SAB de CV

TMT America Movil SA de CV

1.7 4.9 14.4 3.1% 28,055

28-Jul-10 p Barsilcel NV (50.00% stake) TMT Telefonica SA portugal Telecom SgpS SA

- 9,746

11-Jan-10 C fEMSA Cerveza SA de CV Consumer Heineken NV fomento Economico Mexicano SAB de CV

- 7,692

13-Jan-10 C Telmex Internacional SAB de CV (39.30% stake)

TMT America Movil SA de CV

2.6 10.6 23.6 2.2% 6,533

02-May-10 p Alumina do Norte do Brasil SA (57.00% stake); Aluminio Brasileiro SA (51.00% stake); Companhia de Alumina do para (61.00% stake); and paragominas bauxite mine (60.00% stake)


Norsk Hydro ASA Vale SA - 4,900

22-Jan-10 C polibutenos SA Industrias Quimicas (33.33% stake); Quattor participacoes SA (60.00% stake); and Unipar Comercial e distribuidora SA


Braskem SA Uniao de Industrias petroquimicas SA

- 4,238

27-Jan-10 C Bunge participacoes e Investimentos SA


Vale SA Bunge Limited - 3,800

14-Mar-10 p Bridas Corporation (50.00% stake)


CNooC International Limited

Bridas Energy Holdings Ltd

- 3,100

05-Aug-10 p NET Servicos de Comunicacao S.A. (58.06% Stake)

TMT Embratel participacoes SA

1.7 6.8 11.3 14.5% 2,606

09-Jun-10 p grupo financiero financial Services

Banco Santander Bank of America Corporation

n/a n/a - 2,500

03-May-10 p Agre Empreendimentos Imobiliarios SA

Real Estate pdg Realty SA Empreendimentos e participacoes

n/a n/a 13.8 1.5% 1,955

15-Jul-10 p BAC Credomatic gECf financial Services

grupo Aval Acciones y Valores SA

gE Capital global Banking

n/a n/a - 1,900

10-feb-10 C fertilizantes fosfatados SA (36.79% stake)


Vale SA The Mosaic Company; and yara Brasil fertilizantes SA

7.2 - 1,834

03-Aug-10 p Bp Exploration Company (Colombia) Limited


Talisman Energy Inc; Ecopetrol SA

Bp plc - 1,750

18-May-10 p plena Transmissoras SA (Seven Brazilian transmission companies)


State grid Corporation of China

plena Transmissoras SA

- 1,721

C = Completed; p = pending; L = Lapsed Source: mergermarket

Top dEALS & EXpECTEd dEALS

LATIN AM

ERICA


Top dEALS & EXpECTEd dEALS

TOP 5 LATIN AMERICAN ANNOUNCED DEALS OF ThE MONTh (SEP-10)Announced Status Target company Sector Bidder company Seller company Exit multiples (x) Bid premia

1-day beforeDeal value

(US$m)Revenue EBITDA P/E

28-Sep-10 p Mineracao Usiminas SA (30.00% stake)


Sumitomo Corporation Usinas Siderurgicas de Minas gerais

- 1,350

30-Sep-10 p MMX Mineracao e Metalicos SA (15.30% stake)


Sk Networks Company Ltd 21.9 35.1 8.1% 699

21-Sep-10 p Bahia Mineracao Limitada (50.00% stake)


Eurasian Natural Resources Corporation plc

zamin BM NV 58.3 - 670

13-Sep-10 p Holcim Venezuela Construction government of Venezuela Holcim Limited - 650

01-Sep-10 C Companhia Industrial de Vidros

Consumer owens-Illinois Inc grupo Cornelio Brennand

- 603


PIPELINE OF EXPECTED DEALS Situation Target

companySector Potential bidder

companyFinancial adviser to bidder (B); target (T); seller (S)

Seller company Market cap/est. value (US$m)

Comments

Rumoured takeover target

JBS SA Agriculture Minerva SA N/A JBS, the world’s largest meatpacker, may sell its Carceres slaughtering plant located in the state of Mato grosso, said a company officer and an industry source.

Auction Aguas Nuevas


Macquarie Capital, Morgan Stanley Infrastructure or Marubeni

Banco Santander

US$350m Banco Santander is negotiating with a few buyers on the sale of Aguas Nuevas, the Chilean utility, and it is close to sealing a deal, said a source close to the situation. In february, Banco Santander sent out an information memorandum on Aguas Nuevas and bids were expected the following month. Likely buyers are infrastructure funds, such as Macquarie Capital and Morgan Stanley Infrastructure. A published report in dec-09 tagged Japanese conglomerate Marubeni as a potential buyer. The source could not comment on a potential deal value, but it has been reported that Aguas Nuevas could be worth US$350m. The utility has 356,000 customers and an 8.8% share of the Chilean water market. Santander Infrastructure fund II, which specializes in infrastructure assets, acquired the Chilean utility last year from grupo Solari.

Rumoured takeover target

AleSat Combustiveis SA

Services Louis dreyfus SAS; Bunge Limited, petroleo Brasileiro SA; Ultrapar participaceoes SA; Cosan Limited;

Rothschild darby overseas Investments, Ltd.

US$3.5bn AleSat Combustiveis SA, a privately held Brazilian chain of about 1,700 gas stations, is holding talks to sell itself in what is being seen as the last sizeable M&A deal in the ongoing consolidation of Brazil’s fuel-distribution industry.

Expected deals based on confirmed announcements by companies involved

09

LATIN AM

ERICA

Monthly M&A Insider

LEAgUE TABLES

VALUEYTD

30-Sep-10house Value

(US$m)Deal count

1 Credit Suisse 69,998 26

2 Citigroup 50,422 10

3 Bank of America Merrill Lynch 23,728 14

4 Morgan Stanley 16,111 6

5 BTg pactual 12,146 27

6 Credit Agricole CIB 11,732 7

7 Caixa Banco de Investimento 11,038 5

8 UBS Investment Bank 10,768 8

9 Banco Espirito Santo de Investimento 9,886 4

10 Mediobanca 9,746 1

11 Sg 9,746 1

12 Rothschild 9,712 8

13 Allen & Company 9,132 2

14 JpMorgan 8,850 11

15 deutsche Bank 6,855 6Source: mergermarket

VoLUME

The financial advisor league tables by value and volume have been run from 01-Jan-10 to 30-Sep-10 and exclude lapsed and withdrawn deals. The tables cover all sectors and are based on the geography of either the target, bidder or seller being Latin American-based.

YTD 30-Sep-10

house Value (US$m)

Deal count

1 BTg pactual 12,146 27



4 JpMorgan 8,850 11




8 Credit Agricole CIB 11,732 7

9 goldman Sachs 5,629 7


11 deutsche Bank 6,855 6

12 Santander global Banking and Markets 4,707 6

13 HSBC Bank 2,882 6

14 Caixa Banco de Investimento 11,038 5

15 Banco Espirito Santo de Investimento 9,886 4Source: mergermarket

TOP 15 FINANCIAL ADVISORS – LATIN AMERICA

VALUEYTD

30-Sep-10house Value

(US$m)Deal count

1 dewey & LeBoeuf 34,628 3

2 Skadden Arps Slate Meagher & flom 19,498 10

3 Cleary gottlieb Steen & Hamilton 15,488 8

4 Allen & overy 14,742 3

5 Machado Meyer Sendacz e opice 14,301 17

6 Souza, Cescon Avedissian, Barrieu e flesch Advogados 13,856

4

7 Tozzini freire Teixeira E Silva Advogados 13,478 13

8 Uria Menendez 13,269 7

9 freshfields Bruckhaus deringer 13,090 3

10 demarest e Almeida 11,616 16

11 Simpson Thacher & Bartlett 10,318 9

12 Cuatrecasas, goncalves pereira 10,091 4

13 de Brauw Blackstone Westbroek 9,746 1

14 garrigues 9,746 1

15 Houthoff Buruma 9,746 1Source: mergermarket

VoLUME

The legal advisor league tables by value and volume have been run from 01-Jan-10 to 30-Sep-10 and include lapsed and withdrawn deals. The tables cover all sectors and are based on the geography of either the target, bidder or seller being Latin American-based.

YTD 30-Sep-10

house Value (US$m)

Deal count

1 Mattos filho, Veiga filho, Marrey Jr. e Quiroga Advogados

2,296 18

2 Machado Meyer Sendacz e opice 14,301 17

3 pinheiro Neto Advogados 6,620 17

4 demarest e Almeida 11,616 16

5 Barbosa, Mussnich & Aragao 6,107 14

6 Tozzini freire Teixeira E Silva Advogados 13,478 13

7 Estudio Muniz, Ramirez, perez-Taiman & olaya Abogados

945 12

8 Skadden Arps Slate Meagher & flom 19,498 10

9 Azevedo Sette Advogados 556 10



12 prieto & Carrizosa 1,323 8

13 Uria Menendez 13,269 7

14 davis polk & Wardwell 8,300 6

15 Latham & Watkins 6,800 6Source: mergermarket

TOP 15 LEGAL ADVISORS – LATIN AMERICA

10

LATIN AM

ERICA

Monthly M&A Insider

TRENd gRApHS

LATIN AMERICAN M&A qUARTERLY TREND

VALUE VoLUME

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Valu

e (U

S$m

)

0

25

50

75

100

125

150

175

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Num

ber

of d

eals


LATIN AMERICAN M&A qUARTERLY MID-MARKET TREND

VALUE VoLUME

0

1,000

2,000

3,000

4,000

5,000

6,000

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Valu

e (U

S$m

)

0

20

40

60

80

100

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Num

ber

of d

eals

11

LATIN AM

ERICA

Monthly M&A Insider

TRENd gRApHS

LATIN AMERICAN M&A SECTOR BREAKDOwN YTD 2010

VALUE VoLUME

19.7%

9.9%

1.5%

1.1%

1.1%

2.3% 1.1%2.1%

0.6%

43.8%

9.8%

7.5%


Consumer


FinancialServices

Business Services

TMT

Leisure

Transport


Agriculture

Construction

Real Estate

15.7%

19.6%

1.3%2.0%

4.6%

4.6%

10.5%

10.5%12.8%

4.6%

4.6%

9.2%


Consumer


FinancialServices

Business Services

TMT

Leisure

Transport


Agriculture

Construction

Real Estate

LATIN AMERICAN M&A qUARTERLY PRIVATE EqUITY TREND

VALUE VoLUME

0

3

6

9

12

15

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Num

ber

of d

eals

Latin American buyouts

Latin American exits

0

500

1,000

1,500

2,000

2,500

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Valu

e (U

S$m

)

Latin American buyouts

Latin American exits

NORTH

AMERICA

NORTH AMERICAA MERgERMARkET M&A REpORT ON

12Monthly M&A Insider

Drilling shale rock to extract viable natural gas has proven successful in North America, but comes at a high price, due to expensive drilling technology. As more companies clamber for entry into the growing shale gas market, M&A will most likely continue at high volume within the energy sector in order to produce cheaper domestic gas.

Football or Soccer?Liverpool Football Club & Athletic grounds plc, the Uk-based football club in Liverpool, Uk, is changing ownership again. After a huge amount of analysis of the original acquisition by American buyers george gillett Jr. and Tom Hicks, the company will again be owned by American investors.

However New England Sports Ventures, the company that is attempting to buy Liverpool Football Club, will have to wait for the legal dispute to resolve between Liverpool Football Club board members before the acquisition can take place (the deal was announced on 6-Oct-10). New England Sports Ventures is also the owner of the Boston Red Sox.

This deal, if it completes, will be the largest football deal since 2008’s acquisition of Manchester City Football Club Limited by Abu Dhabi United group for Development and Investment for US$492m. The Liverpool Football Club acquisition is estimated to be valued at US$930m, including the assumption of debt which amounts to more than five times the total value of football deals worldwide for YTD 2010. Football deals from 2005 until the present day have consistently floated between six to nine deals a year, but seven have already been done in the year-to-date.

Pfizer: new acquisitions, new drugsAfter selling some of its assets in the first half of 2010, and almost a year after completing its last significant purchase of Wyeth in 2009, pfizer Inc. has started making new acquisitions.

In Sep-10, pfizer announced the purchase of FoldRx pharmaceuticals, Inc, the US-based private pharmaceutical company engaged in the development of therapeutics used in the treatment of protein misfolding diseases, for an undisclosed consideration.

Then, in early Oct-10, pfizer made a tender offer to acquire king pharmaceutical, Inc, the listed US-based pharmaceutical firm, for US$3.6bn in cash. This offer values each share of the target company at US$14.25, representing a 40.0% premium over king’s share price of US$10.15 on 11-Oct-10, one day prior to the announcement of the transaction. This acquisition has been approved by both companies’ Board of Directors and is pending king’s majority shareholder acceptances and regulatory approvals.

Investors are hopeful about the transaction, as on 12-Oct, pfizer’s stock prices rose by US$0.10 compared to the company’s closing price the day before. Some analysts concur that such acquisitions are a logical move for pfizer to increase its drug offerings, especially given the fact that pfizer’s patent protection for Lipitor, one of its most popular and profitable products, is due to expire in 2011. However, it should be noted that the price of US$3.6bn for the acquisition is not much compared to the consideration of US$65.0bn that pfizer paid for Wyeth, a US pharmaceutical company, in 2009, or US$60.0bn that pfizer paid to acquire pharmacia Corporation, the US-based pharmaceutical firm, back in 2002.

HIgH EnErgy SEctor ActIvIty: rESPonSE to US SHAlE gAS trEnd?

SIx OUT OF THE TOp 15 NORTH AMERICAN M&A DEALS FROM JANUARY TO SEpTEMBER 2010 WERE IN THE ENERgY SECTOR, WITH A COMBINED VALUE OF AppROxIMATELY US$57.0BN. THE TOp NORTH AMERICAN DEAL IN SEpTEMBER WAS ALSO IN THE ENERgY SECTOR, WITH A DEAL VALUE OF US$9.0BN. WHILE ALL COMpANIES INVOLVED IN THESE DEALS STATED CONSOLIDATION OF RESOURCES FOR INCREASED EFFICIENCY OF DRILLINg AND gREATER OUTpUT AS REASONS FOR THE TRANSACTIONS, IT MAY BE NO COINCIDENCE THAT THIS FLURRY OF ACTIVITY IN THE ENERgY SECTOR HAS BEEN OCCURRINg pARALLEL TO THE gROWINg US SHALE gAS TREND.

13

NORTH

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Monthly M&A Insider

target: Enterprise gp Holdings Lp Announced: 7-Sep-10

Bidder: Enterprise products partners Lp deal value: US$9.12bn

Seller: - deal nature: Acquisition, Domestic, public

StrUctUrE• Enterprise gp Holdings Lp (EpE), a Delaware corporation,

has signed a definitive agreement to be acquired by Enterprise products partners Lp (EpD), a Delaware corporation. The boards of directors of both companies have approved the merger.

• Enterprise gp Holdings, a US-based company headquartered in Houston, Tx, is one of the largest publicly traded gp partnerships and it owns the general partner of, and limited partner interests in, Enterprise products partners Lp. Through its subsidiaries, Enterprise gp Holdings engages in the midstream energy industry and related businesses.

• Enterprise products partners, a US-based company headquartered in Houston, Tx, is the largest publicly traded energy partnership and a leading North American provider of midstream energy services to producers and consumers of natural gas, NgLs, crude oil, refined products and petrochemicals.

tErMS• 1.5 EpD shares will be exchanged for each EpE share.

• This represents a value of US$57.68 for each EpE share based on EpD’s closing share price on 3-Sep-10 of US$38.45.

• The offer provides a premium of 15.6% based on EpE’s closing share price on 3-Sep-10 of US$49.90.

• The implied equity value of the transaction is approx. US$8.03bn.

• If a superior offer were to emerge for EpE, the company would be required to give EpD at least two business days to make adjustments to its current offer before EpE’s board of directors could effect a change of recommendation of the deal.

rAtIonAlE

• The transaction simplifies the companies’ partnership structure, which reduces complexity and enhances transparency for debt and equity investors. The merger is also expected to provide benefits to current EpD unit-holders by reducing general and administrative costs by approximately US$6m per year, primarily from eliminating public company expenses associated with EpE.

condItIonS • HSR (USA).

• EpE EgM (majority affirmative vote required to approve).

PoSt dEAl dEtAIl• Following the closing of the merger, EpD expects affiliates

of EpCO and management will own approximately 39.00% of EpD’s outstanding common units.

DEAL OF THE MONTH

Advisors

target/Seller Bidder

Financial Morgan Stanley Financial Credit SuisseBarclays Capital

legal Simpson Thacher & Bartlett LLp; Vinson & Elkins LLp; and Baker & Hostetler LLp

legal Skadden Arps Slate Meagher & Flom LLp; Alston & Bird LLp; Andrews kurth LLp; and Morris Nichols Arsht & Tunnell

14

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Monthly M&A Insider

toP 15 nortH AMErIcAn AnnoUncEd dEAlS For ytd 30-SEP-10 Announced Status target company Sector Bidder company Seller company Exit multiples (x) Bid premia

1-day beforedeal value

(US$m)revenue EBItdA P/E

18-Aug-10 p potash Corporation of Saskatchewan Inc


BHp Billiton Ltd 10.5 27.9 40 -9.2% 41,908

22-Apr-10 p Qwest Communications International Inc

TMT CenturyLink 1.8 5.2 15.9 15.0% 22,153

08-Mar-10 C American Life Insurance Company

Financial Services

MetLife American International group

n/a n/a - 15,544

25-Feb-10 C Coca-Cola Enterprises Inc (North American operations)

Consumer The Coca-Cola Company

Coca-Cola Enterprises

- 12,280

21-Feb-10 C Smith International Inc Energy, Mining & Utilities

Schlumberger Limited

1.5 12.7 67.4 18.1% 12,198

19-Jan-10 C The Williams Companies Inc (certain gas pipeline and domestic midstream businesses)


Williams partners The Williams Companies

- 11,750

07-Sep-10 p Enterprise gp Holdings Lp


Enterprise products partners Lp

0.4 3.3 39.0 15.6% 9,121

11-Feb-10 p Allegheny Energy Inc Energy, Mining & Utilities

FirstEnergy Corp 2.6 7.5 12.0 31.6% 8,960

09-Mar-10 p Merial Limited; and Intervet/Schering-plough Animal Health

pharma, Medical & Biotech

Merial-Intervet Merck & Co; and Sanofi-Aventis SA

- 8,250

28-Apr-10 p E.ON US LLC Energy, Mining & Utilities

ppL Corporation E.ON Ag - 7,625

11-Mar-10 C Devon Energy Corporation (assets in the deepwater gulf of Mexico, Brazil and Azerbaijan)


Bp plc Devon Energy Corporation

- 7,000

11-Feb-10 p Airgas Inc Industrials & Chemicals

Air products & Chemicals

1.8 10.8 27.1 3.6% 6,999

28-Feb-10 C Millipore Corporation pharma, Medical & Biotech

Merck kgaA 4.1 16.3 34.0 13.3% 6,760

31-Mar-10 p general growth properties Inc (65.00% stake)

Real Estate Brookfield Asset Management; Fairholme Capital Management LLC; and pershing Square Capital Management

n/a n/a [Loss] -7.5% 6,550

19-Aug-10 p McAfee Inc TMT Intel Corporation 3.4 16.5 44.0 60.4% 6,511C = Completed; p = pending; L = Lapsed Source: mergermarket

TOp DEALS & ExpECTED DEALS

15

NORTH

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Monthly M&A Insider


toP 5 nortH AMErIcAn AnnoUncEd dEAlS oF tHE MontH (SEP-10) Announced Status target company Sector Bidder company Seller company Exit multiples (x) Bid premia

1-day before

deal value

(US$m)revenue EBItdA P/E

07-Sep-10 p Enterprise gp Holdings Lp


Enterprise products partners Lp

0.4 3.3 39.0 15.6% 9,121

02-Sep-10 p Burger king Holdings Inc

Leisure 3g Capital partners 1.5 8.6 17.6 27.3% 3,829

27-Sep-10 p Alberto-Culver Company

Consumer Unilever plc 2.5 17.0 31.3 19.1% 3,595

10-Sep-10 p CTVglobemedia Inc (excluding globe and Mail businesses) (85.00% stake)

TMT BCE Inc Torstar Corporation; Ontario Teachers pension plan Board; The Woodbridge Company Limited

- 2,852

21-Sep-10 p penn Virginia gp Holdings Lp


penn Virginia Resource partners L p

2.4 9.0 25.2 9.4% 1,580


16

NORTH

AMERICA

Monthly M&A Insider

Situation target company Sector Potential bidder company

Financial advisor to bidder (B); target (t); seller (S)

Seller company

Market cap/ est. value (US$m)

comments

Expected Deal Novell TMT Elliott Associates

(T) JpMorgan 2,084 Elliott Associates, L.p. (together with funds under common management), a significant institutional stockholder of Novell, offered to purchase the entire company for US$5.75 per share in cash, which implies an enterprise value net of cash of US$1.00bn. The firm sent a letter to the Board of Directors of the Company explaining its offer.

Expected Deal Dollar Thrifty Automotive group


Avis Budget group,

(B) Citigroup 1,281 Avis Budget group would like to make a substantially higher offer to acquire Dollar Thrifty. Dollar Thrifty had recently signed a definitive agreement to be acquired by Hertz for approximately US$41 per share.

Expected Deal playboy Enterprise Media The Hefner Family

187 playboy Enterprises, Inc. (pEI) announced that its board of directors has formed a special committee consisting of Sol Rosenthal and Shing Tao to evaluate and determine the company's response to the proposal made by Hugh M. Hefner ('Hefner') on 9-Jul-10 to acquire all of the outstanding shares of Class A and Class B common stock of pEI not currently owned by Hefner for US$5.50 per share in cash.

Expected Deal California pizza kitchen

Leisure Undisclosed Bidder

(B)Moelis & Company

439 California pizza kitchen announced that its Board of Directors has authorized management to consider a wide range of financial and strategic alternatives to enhance shareholder value. The company has engaged Moelis & Company, a global investment bank, to be its exclusive financial advisor in this review.

Expected Deal Mediacom Communications Corporation

TMT Mediacom’s founder, Chairman and CEO, Rocco B. Commisso

(B) Bank of American Merrill Lynch, (B) Jp Morgan Securities, (T) Barclays Capital

475 Mediacom Communications Corporation's Board of Directors received a non-binding proposal from Mediacom’s founder, Chairman and Chief Executive Officer, Rocco B. Commisso, for a going private transaction. The proposal contemplates the acquisition of all of the Class A and Class B shares of Mediacom common stock not already beneficially owned by Mr. Commisso at a price of US$6.00 per share in cash.

Expected Deal galleon Energy Energy, Mining & Utilities

Undisclosed Bidder

(T) Cormark Securities, gMp Securities, Macquarie Capital Markets Canada

410 galleon Energy’s financial advisors are talking with potential buyers. galleon announced it had retained gMp Securities, Cormark and Macquarie Capital to review strategic alternatives, which will lude a number of options, luding an outright sale or disposal of a material portion of its assets.

Expected deals are based on confirmed announcements by companies involved.

PIPElInE oF nortH AMErIcAn ExPEctEd dEAlS


17

NORTH

AMERICA

Monthly M&A Insider

LEAgUE TABLES

VALUEytd

30-Sep-10House value

(US$m)deal count


2 Barclays Capital 192,947 77

3 JpMorgan 166,703 78




7 Deutsche Bank 115,010 70



10 Lazard 82,597 76

11 RBC Capital Markets 71,772 66

12 TD Securities 55,722 41

13 perella Weinberg partners 47,323 16

14 Santander global Banking and Markets 46,179 5

15 Royal Bank of Scotland group 45,575 10

16 Evercore partners 43,549 20

17 BNp paribas 42,700 7

18 Blackstone group Holdings 35,742 15

19 Tudor, pickering, Holt & Co 29,675 22

20 greenhill & Co 25,881 20Source: mergermarket

VOLUME

The financial advisor league tables by value and volume have been run from 01-Jan-10 to 30-Sep-10 and exclude lapsed and withdrawn deals. The tables cover all sectors and are based on the geography of either the target, bidder or seller being US or Canadian-based.

ytd 30-Sep-10

House value (US$m)

deal count






6 JpMorgan 166,703 78


8 Lazard 82,597 76


10 RBC Capital Markets 71,772 66


12 Jefferies & Company 23,693 61

13 Houlihan Lokey 10,519 55


15 TD Securities 55,722 41

16 Macquarie group Limited 9,501 37

17 CIBC World Markets plc 17,969 33

18 kpMg 4,831 32

19 Harris Williams & Co 716 31

20 Loln International 4,731 30Source: mergermarket

toP 20 FInAncIAl AdvISorS – nortH AMErIcA

VALUEytd

30-Sep-10House value

(US$m)deal count

1 Skadden Arps Slate Meagher & Flom 183,108 110



4 Sullivan & Cromwell 138,059 99

5 Latham & Watkins 122,948 131

6 Blake, Cassels & graydon 112,687 74

7 Weil gotshal & Manges 97,906 83

8 Slaughter and May 93,736 20

9 Davis polk & Wardwell 93,416 57

10 Wachtell, Lipton, Rosen & katz 87,352 38

11 Cravath Swaine & Moore 83,956 37

12 Debevoise & plimpton 83,703 31

13 Dewey & LeBoeuf 81,888 73

14 Jones Day 81,018 142

15 Stikeman Elliott 71,290 67

16 Shearman & Sterling 66,039 55

17 gibson Dunn & Crutcher 55,262 71

18 Fried Frank Harris Shriver & Jacobson 50,527 34

19 Vinson & Elkins 50,107 39

20 Freshfields Bruckhaus Deringer 49,039 42Source: mergermarket

VOLUME

The legal advisor league tables by value and volume have been run from 01-Jan-10 to 30-Sep-10 and lude lapsed and withdrawn deals. The tables cover all sectors and are based on the geography of either the target, bidder or seller being US or Canadian-based.

ytd 30-Sep-10

House value (US$m)

deal count

1 Jones Day 81,018 142


3 kirkland & Ellis 36,732 127

4 DLA piper 7,380 111

5 Skadden Arps Slate Meagher & Flom 183,108 110



8 Weil gotshal & Manges 97,906 83



11 gibson Dunn & Crutcher 55,262 71

12 k&L gates 15,239 68


14 Wilson Sonsini goodrich & Rosati 13,760 64

15 Morgan Lewis & Bockius 10,361 61




19 Baker & Mckenzie 18,145 51

20 Osler, Hoskin & Harcourt 35,612 50Source: mergermarket

toP 20 lEgAl AdvISorS – nortH AMErIcA

18

NORTH

AMERICA

Monthly M&A Insider

LEAgUE TABLES

VALUE VOLUME

The private equity buyout activity tables by value and volume are based on private equity firms advising the bidder on buyout deals where the dominant geography of the target company is US or Canadian-based. The tables by value and volume have been run from 01-Jan-10 to 30-Sep-10 and exclude lapsed and withdrawn deals.

toP 5 PrIvAtE EqUIty FIrMS By nortH AMErIcAn BUyoUtS

VALUE

ytd 30-Sep-10

House value (US$m)

deal count

1 kohlberg kravis Roberts & Co 4,700 1

2 The Carlyle group, L.L.C. 4,632 4

3 Thomas H Lee partners Lp 4,500 2

4 Cerberus Capital Management Lp 4,046 3

5 Hellman & Friedman LLC 3,525 2Source: mergermarket

VOLUME

The private equity exit activity tables by value and volume are based on private equity firms advising the vendor on exit deals where the dominant geography of the target company is US or Canadian-based. The tables by value and volume have been run from 01-Jan-10 to 30-Sep-10 and exclude lapsed and withdrawn deals.

ytd 30-Sep-10

House value (US$m)

deal count

1 Highland Capital partners Inc 471 7

2 Intel Capital 30 7

3 Mayfield Fund 294 6

4 Battery Ventures 860 5

5 Foundation Capital 0 5Source: mergermarket

toP 5 PrIvAtE EqUIty FIrMS By nortH AMErIcAn ExItS

ytd 30-Sep-10

House value (US$m)

deal count

1 Blackstone group Holdings LLC 10,143 4

2 Silver Lake partners 6,259 4


4 Centerbridge partners Lp 3,925 3

5 3g Capital partners 3,829 1Source: mergermarket

ytd 30-Sep-10

House value (US$m)

deal count

1 Tpg Capital Lp 3,249 7

2 H.I.g. Capital, LLC 149 7

3 Ontario Teachers pension plan Board 1,173 6


5 The Carlyle group, L.L.C. 3,772 5Source: mergermarket

19

NORTH

AMERICA

Monthly M&A Insider

TREND gRApHS

nortH AMErIcAn M&A qUArtErly trEnd

0

100,000

200,000

300,000

400,000

500,000

600,000

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Valu

e (U

S$m

)

0

200

400

600

800

1,000

1,200

1,400

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Num

ber

of d

eals

nortH AMErIcAn M&A qUArtErly MId-MArkEt trEnd

VALUE VOLUME

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Valu

e (U

S$m

)

0

100

200

300

400

500

600

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Num

ber

of d

eals


VALUE VOLUME

20

NORTH

AMERICA

Monthly M&A Insider

TREND gRApHS

nortH AMErIcAn M&A SEctor BrEAkdown ytd 2010

VALUE VOLUME

30.6%

13.6%

6.7%

9.1%

8.2%

14.0%

0.8%1.5%

0.1%0.8%

10.7%

1.6%

2.5%


Financial Services

Business Services

Consumer


TMT

Leisure

Transportation


Construction

Agriculture

Real Estate

Defence

14.2%

14.0%

11.4%

12.7%

10.0%

8.5%

3.3%

1.4%

1.1%

0.9%

19.2%

0.4%

3.0%Industrials & Chemicals

Financial Services

Business Services

Consumer


TMT

Leisure

Transportation


Construction

Agriculture

Real Estate

Defence

nortH AMErIcAn M&A qUArtErly PrIvAtE EqUIty trEnd

0

25,000

50,000

75,000

100,000

125,000

150,000

175,000

200,000

225,000

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Valu

e (U

S$m

)

North American buyouts

North American exits

0

25

50

75

100

125

150

175

200

225

250

275

300

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Num

ber

of d

eals

North American buyouts

North American exits

VALUE VOLUME

21

NORTH

AMERICA

Monthly M&A Insider

TREND gRApHS

nortH AMErIcAn M&A dEAl SIzE BrEAkdown

VALUE VOLUME

0

100

200

300

400

500

600

700

800

900

1,000

H210*

H110

H209

H109

H208

H108

H207

H107

H206

H106

H205

H105

H204

H104

> US$501m

US$251m-US$500m

US$101m-US$250m

US$15m-US$100m

US$5m-US$14.9m

Valu

e (U

S$bn

)

0

500

1000

1500

2000

2500

3000

H210*

H110

H209

H109

H208

H108

H207

H107

H206

H106

H205

H105

H204

H104

Num

ber

of d

eals

> US$501m

US$251m-US$500m

US$101m-US$250m

US$15m-US$100m

US$5m-US$14.9m

Value not disclosed

ASIA-PAcIfIc

A mergermArket m&A report on


ASIA-pAcIfIc

Among other reasons, the Asia-pacific m&A market experienced a number of lapsed deals after regulatory bodies disapproved of deals. While prudential’s high-profile offer for AIA was withdrawn due to failure in price negotiation, the deals between AXA, AXA Asia-pacific Holdings and national Australia Bank Limited fell through because of the Australian competition and consumer commission’s (Accc) opposition on the grounds of concerns over competition issues in Australia and new Zealand. the Accc also caused two other Australian deals to lapse in 2010. the commission has been concerned about local market competition for the supply of petrol and also securities registration, this resulted in the failure to sell exxonmobil station sites and newreg pty Ltd, respectively.

In 2010, up to 30 September, 11 deals with a total deal value of US$16.9bn had lapsed due to regulatory issues only. this roughly equals to a 6.0% value of all announced deals in Asia-pacific in 2010. the regulatory-related lapsed deals in Asia-pacific came from five countries, including four cases in Australia, two in china, and two in taiwan. It is not news that countries in Asia-pacific, notably developing countries, are protective of their local firms, with foreign investment regulations and government intervention to m&A deals not uncommon. A notable example would be the lapse of the coca cola - china Huiyan Juice deal in 2008, as it was disapproved by china’s ministry of commerce over concerns of market concentration. In the near future, policy risk will still be prevalent when doing deals in the Asia-pacific region, and the variable regulations of different territories may add to the disparity in levels of m&A.

Japanese overseas acquisition expands to developing countriesthe number of overseas acquisition by Japanese companies is at a mediocre level this year in spite of the image being spread by the media that Japanese companies are active in the m&A market overseas; data shows that there has not been any significant increase in acquisition’s either in terms of value or volume.

According to mergermarket data, the number of overseas acquisition by Japanese companies is 56 for the first three quarters of the year, remaining at half of the full year data in the past five years. the total value is US$20.8bn, above average, but not as high as in 2006 or 2008, years in which some major transactions took place, including Japan tobacco’s acquisition of gallaher group or takeda’s acquisition of millennium pharmaceuticals. In terms of the number, there is nothing particularly outstanding about the trend this year. It does not look like Japanese companies are taking advantage of their appreciated currency, as certain media outlets are trying to depict.

Instead, this year’s cross-border dealmaking trend appears to be the diversity of investment destinations. of the top 10 outbound deals by Japanese companies, seven of them are in developing countries. there has also been diversification in sectors targeted, as an increasing number of overseas acquisitions have been made in an attempt to secure natural resources or to expand in the consumer market. the trend of Japanese overseas acquisitions is showing a shift away from matured markets to countries with more potential for growth.

RegulAtoRy Issues oveRshAdow the AsIA-PAcIfIc M&A

tHe yeAr BegAn WItH An UpBeAt fIrSt qUArter In ASIA. SeverAL mAJor trAnSActIonS Were AnnoUnced In tHe perIod, IncLUdIng prUdentIAL/AIA’S US$35.5Bn deAL, And tHe totAL vALUe of AnnoUnced deALS WAS AroUnd US$118.0Bn At tHe tIme, WHIcH WAS tHe BIggeSt fIrSt qUArter on record. After tHe end of tHe tHIrd qUArter, HoWever, mAny deALS, IncLUdIng tHree of tHe LArgeSt deALS of tHe yeAr AnnoUnced In tHe fIrSt qUArter, ended Up BeIng cAnceLLed; mAkIng 2010 tHe BIggeSt yeAr In termS of tHe totAL vALUe of LApSed deALS on record. tHere HAve Been A totAL of 57 deALS WortH US$69.1Bn tHAt HAve LApSed ALreAdy In tHe yeAr-to-dAte.

ASIA-PAcIfIc


xxtarget: Shenzhen development Bank co Ltd (31.97% stake) Announced: 1-Sep-10

Bidder: ping An Insurance (group) company of china Ltd deal value: US$4.27bn

seller: deal nature: recommended

• ping An Insurance (group) company of china Ltd has agreed to acquire a 31.97% stake in Shenzhen development Bank co. Ltd (SdB) through a new share issuance.

• ping An Insurance (group) company of china Ltd, a listed china based company headquartered in Shenzhen, is an insurance company providing various financial products and services with a focus on insurance, banking, and investment businesses. Shenzhen development Bank co. Ltd, a listed china based company headquartered in Shenzhen, is a commercial bank.

teRMs

• ping An Insurance has agreed to subscribe to 1,639m new SdB shares at price of cny17.75 (US$2.60) per share.

• the subscription shares represents 31.97% stake in the enlarged SdB share capital.

• the consideration will be satisfied by via the issue of 7,825,181,106 shares in ping An Bank co Ltd (pAB), an affiliate of ping An Insurance, representing 90.75% in pAB, with the balance is to be paid in cash.

• the implied equity value for the transaction is approximately cny90.96bn (US$13.35bn).

• the subscription shares are subject to a lock up period of 36 months after the end of the issue of the subscription.

fINANcINg• the transaction will be funded through the cash reserves

of ping An Insurance.

teRMINAtIoN• In the event that one party is in breach and does not

remedy the breach within 30 days from the date, the non-defaulting party will be entitled to issue a written notice to the defaulting party to either complete the transaction or terminate the agreement. the defaulting part will be entitled to bear the losses for the same.

RAtIoNAle• the transaction will help in avoiding in potential peer

competition between ping An Bank and SdB.

• It will also allow both companies to fully utilise their synergies, thereby maximising the value for their shareholders.

Post deAl detAIls• ping An Insurance will increase its stake in SB from the

current 29.99% to 52.39% in the enlarged share capital of SdB.

• ping An Bank co Ltd will be 90.75% owned subsidiary of SdB and will continue to be indirect subsidiary of ping An Insurance due to its controlling shareholding in SdB.

coNdItoNs• SdB shareholders approval.

• ping An Insurance shareholders approval.

• china Insurance regulatory commission approval.

• relevant competition authorities approval.

BAcKgRouNd• ping An Insurance acquired a 16.76% stake in SdB in Jun-

09 for a total consideration of cny15.58bn (US$2.28bn) from tpg capital, the US based private equity, and a further 10.65% in the same month for a consideration of cny6.76bn (US$988m).

• trading in shares of ping An Insurance and SdB have been suspended from 30-Jun-10.

deAL of tHe montH

24

ASIA-PAcIfIc

Monthly M&A Insider

deAL of tHe montH

Advisers

target/seller Bidder

financial credit Suisse; cItIc Securities financial china International capital

legal - legal deHeng Law offices

PR - PR -

exit multiples – y/e 31-dec-09 Premium analysis

Multiples value (cNym) offer price per share (cNy) 17.75

Revenue n/a n/a 1 day before -

eBItdA n/a n/a 1 month before -

eBIt n/a n/a 1 day after -2.42%

earnings 11.0x 5,031 Pre-rumour n/a


ASIA-PAcIfIc

toP 15 AsIA-PAcIfIc ANNouNced deAls foR ytd 30-seP-10Announced status target company sector Bidder company seller company exit multiples (x) Bid premia


(us$m)Revenue eBItdA P/e

01-mar-10 L American International Assurance company Limited

financial Services

prudential plc American International group Inc

n/a n/a 20.2 - 35,500

24-Aug-10 p the Sumitomo trust & Banking co Ltd

financial Services

chuo mitsui trust Holdings Inc

n/a n/a 17.1 -0.7% 9,267

16-Aug-10 p cairn India Limited (60.00% stake)

energy, mining & Utilities

vedanta resources plc

33.0 64.3 61.7 - 9,177

30-mar-10 L AXA Asia pacific Holdings (Asian businesses)

financial Services

AXA SA AXA Asia pacific Holdings Limited

n/a n/a 24.7 - 8,645

04-may-10 c Lihir gold Limited energy, mining & Utilities

newcrest mining Limited

8.5 19.9 54.2 9.5% 8,286

10-mar-10 p Shanghai pudong development Bank (20.00% stake)

financial Services

china mobile group guangdong co Ltd

n/a n/a 11.1 -13.1% 5,831

29-Jul-10 c Sanyo electric co Ltd (49.95% stake)

Industrials & chemicals

panasonic corporation

0.7 11.1 (loss) -7.4% 4,882

29-Jul-10 c panasonic electric Works Ltd (49.00% stake)


panasonic corporation

0.6 9.9 103.2 -1.2% 4,698

01-Sep-10 p Shenzhen development Bank co Ltd (31.97% stake)

financial Services

ping An Insurance (group) company of china Ltd

n/a n/a 11.0 - 4,269

30-Sep-10 p AIg Star Life Insurance co Ltd; and AIg edison Life Insurance company

financial Services

prudential financial Inc

American International group Inc

n/a n/a - 4,200

31-Aug-10 p Japan Airlines corp transport enterprise turnaround Initiative corporation of Japan

0.2 6.1 (loss) - 4,165

25-Jan-10 c Jupiter telecommunications co Ltd (37.80% stake)

tmt kddI corporation Liberty global Inc

3.6 8.3 32.6 64.5% 4,014

21-may-10 c piramal Healthcare Solutions business

pharma, medical & Biotech

Abbott Laboratories piramal Healthcare Limited

8.3 - 3,720

30-mar-10 L AXA Asia pacific Holdings Limited

financial Services

national Australia Bank Limited

n/a n/a 21.8 1.3% 3,579

30-Aug-10 p daewoo International corporation (68.15% stake)

Business Services

poSco kAmco 0.5 30.4 37.9 53.5% 3,547

c = completed; p = pending; L = Lapsed Source: mergermarket

top deALS & eXpected deALS

toP 5 AsIA-PAcIfIc ANNouNced deAls of the MoNth (seP-10)Announced status target company sector Bidder company seller company exit multiples (x) Bid premia


(us$m)Revenue eBItdA P/e

01-Sep-10 p Shenzhen development Bank co Ltd (31.97% stake)

financial Services

ping An Insurance (group) company of china Ltd

n/a n/a 11.0 - 4,269

30-Sep-10 p AIg Star Life Insurance co Ltd; and AIg edison Life Insurance company

financial Services

prudential financial Inc American International group Inc

n/a n/a - 4,200

03-Sep-10 p Andean resources Limited


goldcorp Inc (loss) (loss) 38.5% 3,309

03-Sep-10 L Andean resources Limited


eldorado gold corporation

(loss) (loss) 36.0% 3,251

08-Sep-10 p Avoca resources Limited


Anatolia minerals development Ltd

3.9 7.5 18.8 2.4% 932

c = completed; p = pending; L = Lapsed Source: mergermarket

26

ASIA-PAcIfIc

Monthly M&A Insider

PIPelINe of AsIA-PAcIfIc exPected deAlssituation target company sector Potential bidder

companyfinancial adviser to bidder (B); target (t); seller (s)

seller company

Market cap/ est. value (us$m)

comments

expected deal

Leighton Holdings Limited

construction Actividades des construcción y Servicios

10,188 Spanish company Actividades des construcción y Servicios (AcS) announced a public takeover offer for Hochtief in Sep-10. Hochtief holds 54.50% of Leighton, therefore it may trigger a mandantory offer if AcS launch a waterfall bid for Leighton. However, AcS made a statement indicating they have no intention of making a bid and had applied for downstream exemption.

expected deal

transurban group

construction canada pension plan Investment Board (cppIB); and ontario teachers’ pension plan (otpp)

Lazard (t); UBS Investment Bank (t); goldman Sachs (B); Jpmorgan (B)

6,500 In nov-09, transurban group received a conditional and non-binding joint takeover proposal from cppIB and otpp. the Board then evaluated the proposal and rejected. the future fund Board of guardians has subsequently considered supporting the proposal by cppIB and otpp. transurban continues to insist a bona fide proposal is needed before talks can proceed. In may -10, cppIB and otpp raised its offer from AUS$5.25 per transurban share to AUS$5.57 per share. the revised takeover proposal was again rejected by transurban as transurban considered the offer still too low.

expected deal

Whitehaven coal Limited


2,592 In Aug-10, Whitehaven was rumoured to have received interest from overseas buyers. the company later stated that they have had, and continue to have, discussions with third parties in relation to potential corporate transactions.

expected deal

Laiwu Steel co Ltd


Jinan Iron & Steel company

1,260 Jinan Steel and Laiwu Steel announced the proposal for a merger via equity swap on 24-feb-10. Both companies suspended their stock trading on 09-Sep-10, as Shandong Iron and Steel group is planning significant asset restructuring, and will resume stock trading after the proposal is finalised.

expected deal

Wai chun mining Industry group co Ltd

consumer china railway group Limited

404 Wai chun mining has signed a memorandum of understanding in relation to the possible issue of new shares which may lead to a change in control of the company.

expected deal

Handsome Inc consumer Sk networks company Ltd

357 Sk networks, the listed South korean wholesaler, has confirmed that it is in talks to buy Handsome, the listed South korean apparel maker.

expected deal

redflex Holdings Limited

tmt macquarie group Limited

greenhill & co (t) 206 redflex Holdings Limited received an indicative, non-binding and confidential proposal to acquire all of the issued capital of redflex by scheme of arrangement from a wholly owned subsidiary of macquarie group Limited at a price of AUS$2.50 per share.

expected deal

Boom Logistics

transport Archer capital and mcAleese group

morgan Stanley (B); Lazard (t)

200 Boom Logistics, the Australian-listed crane hire business, has received a takeover offer from Archer capital and mcAleese group. Boom Logistics received two conditional proposals from Archer in April. the company rejected the first bid outright due to its conditionality. Boom Logistics has not yet formalised its response to the second offer of AUS$0.52 per Boom Logistics share.

expected deals based on confirmed announcements by companies involved

top deALS & eXpected deALS

27

ASIA-PAcIfIc

Monthly M&A Insider

LeAgUe tABLeS

vALUeytd

30-sep-10house value

(us$m)deal count

1 morgan Stanley 50,174 33

2 credit Suisse 40,964 32



5 Jpmorgan 35,588 29

6 Bank of America merrill Lynch 34,258 22


8 rothschild 33,390 35

9 HSBc Bank 33,390 17

10 Barclays capital 31,618 14

11 Standard chartered 26,632 13

12 Bnp paribas 25,128 13

13 royal Bank of Scotland group 22,220 11

14 citigroup 21,503 21

15 china International capital 20,213 13

16 macquarie group 16,817 22

17 Lazard 14,858 9

18 Bmo capital markets 14,583 5

19 cImB group 14,043 25

20 grant Samuel 13,347 9Source: mergermarket

voLUme

the financial adviser league tables by value and volume have been run from 01-Jan-10 to 30-Sep-10 and exclude lapsed and withdrawn deals. the tables cover all sectors and are based on the geography of either the target, bidder or seller being Asia-pacific-based, excluding Japan.

ytd 30-sep-10

house value (us$m)

deal count

1 ernst & young 9,101 45



4 deloitte 9,765 37


6 kpmg 8,413 34



9 credit Suisse 40,964 32

10 Jpmorgan 35,588 29

11 pricewaterhousecoopers 6,958 29

12 cImB group 14,043 25


14 macquarie group 16,817 22


16 HSBc Bank 33,390 17


18 Standard chartered 26,632 13


20 china International capital 20,213 13Source: mergermarket

toP 20 fINANcIAl AdvIseRs – AsIA-PAcIfIc excl JAPAN

toP 20 legAl AdvIseRs – AsIA-PAcIfIc excl JAPANvALUe

ytd 30-sep-10

house value (us$m)

deal count

1 Herbert Smith/gleiss Lutz/Stibbe 60,932 13

2 debevoise & plimpton 56,064 6

3 norton rose 45,777 33

4 Slaughter and may 43,754 13

5 Sullivan & cromwell 40,997 11

6 Simpson thacher & Bartlett 39,440 11

7 davis polk & Wardwell 37,727 13

8 cleary gottlieb Steen & Hamilton 37,549 6

9 cravath Swaine & moore 36,988 2

10 Weil gotshal & manges 36,529 6

11 mallesons Stephen Jaques 36,438 43

12 freehills 32,306 48

13 AZB & partners 29,907 49

14 Allens Arthur robinson 28,405 28

15 Allen & overy 28,003 24

16 Linklaters 26,777 23

17 Skadden Arps Slate meagher & flom 24,523 24

18 Baker & mckenzie 17,911 46

19 Stikeman elliott 12,630 8

20 freshfields Bruckhaus deringer 12,535 25Source: mergermarket

voLUme

the legal adviser league tables by value and volume have been run from 01-Jan-10 to 30-Sep-10 and include lapsed and withdrawn deals. the tables cover all sectors and are based on the geography of either the target, bidder or seller being Asia-pacific-based, excluding Japan.

ytd 30-sep-10

house value (us$m)

deal count

1 dLA piper 10,454 52


3 freehills 32,306 48


5 mallesons Stephen Jaques 36,438 43

6 minter ellison 10,681 38

7 Wongpartnership 9,155 35


9 kim & chang 10,752 31

10 desai & diwanji 1,383 29

11 Allens Arthur robinson 28,405 28

12 Jones day 3,500 26


14 Allen & gledhill 8,582 25

15 clayton Utz 7,816 25

16 Allen & overy 28,003 24


18 Blake dawson 11,851 24


20 Amarchand & mangaldas & Suresh A Shroff & co

6,106 22

Source: mergermarket

28

ASIA-PAcIfIc

Monthly M&A Insider

LeAgUe tABLeS

vALUe

ytd 30-sep-10

house value (us$m)

deal count

1 nomura Holdings 36,683 54


3 daiwa Securities group 16,565 24






9 citigroup 5,987 6

10 ABeam m&A consulting 5,271 2


12 perella Weinberg partners 4,200 1

13 mizuho financial group 3,962 32

14 greenhill & co 3,510 3

15 Lazard 3,391 3Source: mergermarket

voLUme

the financial adviser league tables by value and volume have been run from 01-Jan-10 to 30-Sep-10 and exclude lapsed and withdrawn deals. the tables cover all sectors and are based on the geography of either the target, bidder or seller being Japan-based.

ytd 30-sep-10

house value (us$m)

deal count

1 nomura Holdings 36,683 54

2 mizuho financial group 3,962 32


4 daiwa Securities group 16,565 24

6 Sumitomo mitsui financial group 2,591 20

5 gcA Savvian 1,557 14

7 pricewaterhousecoopers 1,088 12



10 kpmg 873 10

11 ernst & young 647 7




15 UBS Investment Bank 13,405 5Source: mergermarket

toP 15 fINANcIAl AdvIseRs – JAPAN

vALUe

ytd 30-sep-10

house value (us$m)

deal count

1 nagashima ohno & tsunematsu 35,074 32

2 mori Hamada & matsumoto 28,356 53



5 nishimura & Asahi 11,922 26

6 gibson dunn & crutcher 9,331 4


8 Anderson mori & tomotsune 6,933 14


10 morrison & foerster 5,683 13


12 kikkawa Law offices 4,774 2


14 dewey & LeBoeuf 3,778 3

15 freshfields Bruckhaus deringer 3,582 7Source: mergermarket

voLUme

the legal adviser league tables by value and volume have been run from 01-Jan-10 to 30-Sep-10 and include lapsed and withdrawn deals. the tables cover all sectors and are based on the geography of either the target, bidder or seller being Japan-based.

ytd 30-sep-10

house value (us$m)

deal count

1 mori Hamada & matsumoto 28,356 53

2 nagashima ohno & tsunematsu 35,074 32

3 nishimura & Asahi 11,922 26

4 Anderson mori & tomotsune 6,933 14

5 tmI Associates 2,772 14

6 morrison & foerster 5,683 13





11 davis polk & Wardwell 859 9




15 Allen & overy 3,838 5Source: mergermarket

toP 15 legAl AdvIseRs – JAPAN

29

ASIA-PAcIfIc

Monthly M&A Insider

trend grApHS

AsIA-PAcIfIc M&A quARteRly tReNd

vALUe voLUme

0

50,000

100,000

150,000

200,000

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Valu

e (U

S$m

)

0

100

200

300

400

500

600

700

800

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Num

ber

of d

eals

AsIA-PAcIfIc M&A quARteRly MId-MARKet tReNd

vALUe voLUme

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Valu

e (U

S$m

)

0

100

200

300

400

500

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Num

ber

of d

eals

moving average trend line

30

ASIA-PAcIfIc

Monthly M&A Insider

trend grApHS

AsIA-PAcIfIc M&A sectoR BReAKdowN ytd 2010

vALUe voLUme

14.3%

15.5%

6.9%

20.3%

16.7%

5.4%

3.6%

2.1%

5.1%

6.9%

1.1%2.2%


TMT

Consumer


Financial Services

Business Services


Construction

Real Estate

Transport

Leisure

Agriculture

20.1%

14.3%

12.1%

8.4%

9.3%

2.3%

11.2%

5.6%

4.8%

4.5%

4.5%2.8%


TMT

Consumer


Financial Services

Business Services


Construction

Real Estate

Transport

Leisure

Agriculture

AsIA-PAcIfIc M&A quARteRly PRIvAte equIty tReNd

vALUe voLUme

0

5,000

10,000

15,000

20,000

25,000

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Valu

e (U

S$m

)

Asia-Pacificbuyouts

Asia-Pacificexits

0

20

40

60

80

100

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Num

ber

of d

eals

Asia-Pacificbuyouts

Asia-Pacificexits

31

ASIA-PAcIfIc

Monthly M&A Insider

trend grApHS

AsIA-PAcIfIc M&A geogRAPhIc BReAKdowN ytd 2010

vALUe voLUme

China

Australia

Japan

India

South Korea

Hong Kong

Singapore

Malaysia

Indonesia

Taiwan

Other

18.4%

6.1%

15.7%

6.4%

3.4%

6.6%

4.6%

2.1%

1.4%

16.9%

18.3%

26.1%

10.6%

11.0%

14.0%

15.1%

5.4%

5.8%

4.5%

3.3%

2.3%

1.8%

China

Australia

Japan

India

South Korea

Hong Kong

Singapore

Malaysia

Indonesia

Taiwan

Other

AsIA-PAcIfIc M&A deAl sIZe BReAKdowN

vALUe voLUme

0

50

100

150

200

250

300

H210*

H110

H209

H109

H208

H108

H207

H107

H206

H106

H205

H105

H204

H104

> US$501m

US$251m-US$500m

US$101m-US$250m

US$15m-US$100m

US$5m-US$14.9m

Valu

e (U

S$bn

)

0

300

600

900

1,200

1,500

H210*

H110

H209

H109

H208

H108

H207

H107

H206

H106

H205

H105

H204

H104

> US$501m

US$251m-US$500m

US$101m-US$250m

US$15m-US$100m

US$5m-US$14.9m

Value not disclosed

Num

ber

of d

eals


europe

A mergermArket m&A report on

eUrope

Since the last 1-Jan-10, private equity deals amounted to 26.1% of all Uk m&A value, while its share was only 8.3% for the nine first months of 2009. If this market share is still far below 2006 records, when buyout activity accounted 45.6% of all Uk m&A value, activity is undoubtedly warming up.

the exit market is following the same rising trend with €8.4bn worth of deals announced during the first nine months of the year in Uk - more than four times the total value of exit deals during the same period in 2009. With a total value of €7.1bn since the beginning of the year, secondary buyouts represented 84.0% of the total exit value in the Uk, with the remaining 16.0% being led by trade sales.

there is no sign of private equity activity cooling down. Indeed, 46 buyouts worth almost €10.3bn were announced in Q3 2010, representing a 14.8% increase in value from the previous quarter, and more than a 190.0% increase compared to Q3 2009.

Analysts are unanimous, the private equity will continue its comeback in the Uk, “trade sales and secondary buyouts are leading the way – a trend which is very likely to continue into the fourth quarter,” said Sachin Date, markets partner at ernst & Young. more than three-quarters of Uk private equity executives have said they planned to exit as much as half of their portfolio in the next 12 months, according to a survey by grant thornton.

If private equity activity is recovering slightly faster in the Uk than on the continent, there is no doubt that european buyouts will follow the same upward trend. With a 20.7% share of the value of european m&A transactions, buyouts are up from a 7.9% share on the same period last year, supported by new available funding sources.

Indeed, banks are rediscovering their appetite for lending for buyout dealsthis is highlighted by the €2.0bn loan to finance the €2.5bn CVC Capital partners’ takeover of Sunrise, the Switzerland-based mobile phone operator, announced on 17-Sep; according to bankers, this is the largest leveraged loan in europe for two years.

the debt package included €630m of senior term loans, €1.1bn of bonds, a €115m acquisition facility and a €75m revolving credit facility. the package was initially underwritten by only two banks, Bnp paribas and Deutsche Bank, rarely seen since the bubble burst in 2007. they were later joined by Société générale, UBS and UniCredit . the size of the debt in the Sunrise deal exceeded the other big european buyouts of the year, the €2.5bn purchase of royal Bank of Scotland’s payment processing arm by Advent International and Bain Capital.

With banks recovering from the credit turmoil, debt has been scarce for private equity firms, which have been setting up deals with record levels of equity; equity accounted for three-quarters of financing in larger european buyouts in the first six months of the year, according to the Financial times.

the sale of Sunrise by tDC, the Danish telecoms group, followed a decision by Swiss regulators in April to block its proposed merger with the Swiss mobile phone business of France telecom. the latest transaction allows tDC’s private equity owners, Apax partners, Blackstone, kohlberg kravis roberts, permira and providence equity partners, to refocus on the nordic region, and to repay debt ahead of an expected Ipo later this year. the deal will mean that CVC, the most active private equity investors in europe in terms of value in 2010, has invested about 45.0% of the €11.0bn buyout fund it raised two years ago.

TAkeovers by prIvATe equITy fIrMs AccounTed for More ThAn A quArTer of All uk M&A vAlue durIng The fIrsT Three quArTers of 2010, reveAlIng A cleAr bounce bAck In The prIvATe equITy IndusTry.

In the Uk, €19.4Bn Worth oF BUYoUt DeAlS Were AnnoUnCeD In the Q1-Q3 2010 perIoD, Up From onlY €2.8Bn For the SAme perIoD lASt YeAr. WhIle BUYoUt ACtIVItY IS StIll FAr BeloW the leVelS reACheD BeFore the peAk oF the CreDIt BUBBle, (€72.8Bn Worth oF BUYoUt DeAlS Were AnnoUnCeD In the nIne FIrSt monthS oF 2006 In the Uk), It hAS reBoUnDeD From ItS 2009 VAlUe, the loWeSt reCorDS on mergermArket DAtABASe.

33

europe

Monthly M&A Insider

Target: electricite de France SA (Uk based distribution network) Announced: 7-Sep-10

bidder: Cheung kong Infrastructure holdings limited; hongkong electric holdings limited; li ka Shing (overseas) Foundation; and li ka Shing Foundation limited

deal value: €6.99bn

seller: eDF energy plc deal nature: Auction, Cross-border, public

• hongkong electric holdings limited, Cheung kong Infrastructure holdings limited, li ka Shing Foundation limited and li ka Shing (overseas) Foundation, have agreed to acquire the Uk-based distribution networks of electricite de France SA.

• hongkong electric holdings limited (heh), a listed hong kong-based company is engaged in the generation and distribution of electricity. Cheung kong Infrastructure holdings limited (CkI), a listed hong kong-based company is a diversified infrastructure group. li ka Shing Foundation limited and li ka Shing (overseas) Foundation, hong kong-based charitable organisations founded by entrepreneur and philanthropist li ka Shing. electricite de France SA, a listed France-based generator, transmitter and distributor of energy and provider of energy services.

TerMs:• Consideration of £5.78bn will be paid to eDF. It includes

equity consideration of £3.20bn and assumed debt of £2.58bn.

fInAncIng:• the transaction will be financed through a £665m loan

raised from the royal Bank of Scotland group (rBS), Deutsche Bank Ag, Bnp paribas SA, Barclays Capital, Inc., lloyds Banking group, mizuho Bank, ltd. and Santander.

rATIonAle:• the transaction will allow electricite de France to

reduce its debt levels. on other hand, it will allow CkI and heh’s to further strengthen their global portfolio of electricity investments.

InduceMenT fee:• eDF is entitled to receive compensation of £100m in the

event either one of the Shareholder Approval Conditions is not satisfied and £50m in the event that the Competition Condition is not satisfied.

AsseT AcquIred:

• the Uk-based distribution networks of electricite de France SA comprise of three regional networks with a distribution area that covers london, South east england and the east of england serving around 7.8 million customers. In addition, eDF’s business includes a non-regulated business comprising commercial contracts to distribute electricity to a number of privately owned sites

expecTed coMpleTIon: • By 2011.

posT deAl deTAIls:• post-acquisition, hongkong electric holdings limited and

Cheung kong Infrastructure holdings limited will own 40.00% each while li ka Shing Foundation limited and li ka Shing (overseas) Foundation will own the remaining 20.00% stake of the company.

condITIons:• regulatory approval.

• Cheung kong Infrastructure holdings limited shareholders approval.

• hongkong electric holdings limited shareholders approval.

• France economy minister approval.

• european Commission Directorate-general approval.

DeAl oF the month

34

europe

Monthly M&A Insider

DeAl oF the month

Advisers

Target/seller bidder

financial Deutsche Bank; Bnp paribas; and Barclays Capital financial royal Bank of Scotland group

legal herbert Smith; gleiss lutz; and Stibbe legal Allen & overy (advising RBS); and DlA piper

pr Brunswick group pr

mergermarket/dealreporter Intelligence

30-Jul-10 eDF: Sale of Uk grid would end divestiture programme.

29-Jul-10 eDF receives two bids for Uk electricity grid.

16-Jul-10 eDF seeking final offers for Uk grid by 26-Jul.

14-Apr-10 eDF Uk electricity network sale decision 'some way off', CkI and macquarie consortium ‘fiercely competitive’ but SSe lagging behind.

bAckground: • Back on 30-Jul-10, hongkong electric holdings limited,

Cheung kong Infrastructure holdings limited, li ka Shing Foundation limited and li ka Shing (overseas) Foundation entered into a bidding process for the proposed acquisition of the Uk-based distribution network of electricite de France SA pursuant to which the consortium made an irrevocable offer to acquire 100.00% of eDF energy’s ownership in its Uk regulated and non-regulated activities.Following consultation with the eDF group’s european Works Council, eDF’s Board of Directors approved the sale of its Uk electricity distribution networks to the Cheung kong group.

35

europe

Monthly M&A Insider

Top 15 europeAn Announced deAls yTd 30-sep-10Announced status Target company sector bidder company seller company exit multiples (x) bid premia


(€m)revenue ebITdA p/e

10-Aug-10 p gDF Suez energy International


International power plc gDF Suez SA 10.4 20,701

04-Jan-10 C Alcon Inc (52.00% stake)


novartis Ag nestle S.A. 8.0 20.9 26.9 9.5% 18,247

30-Jun-10 p oJSC polyus gold energy, mining & Utilities

kazakhgold group limited

9.8 22.8 35.0 5.4% 8,367

07-Sep-10 p electricite de France SA (Uk-based distribution network)


Cheung kong Infrastructure holdings limited; hongkong electric holdings limited; li ka Shing (overseas) Foundation; and li ka Shing Foundation limited

eDF energy plc 6,994

25-Sep-10 p Caja de Ahorros de Asturias

Financial Services

Caja de Ahorros del mediterraneo

4,928

05-Jan-10 C nk russneft oAo energy, mining & Utilities

mikhail gutseriyev (private Investor)

en+ group ltd 4,595

14-Jun-10 C JSC Uralkali (53.20% stake)


kaliha Finance limited; Aerellia Investments limited; and Becounioco holdings limited

madura holding limited

10.5 21.7 37.9 21.4% 4,254

12-Sep-10 p Deutsche postbank Ag (70.05% stake)

Financial Services

Deutsche Bank Ag 71.4 -7.5% 3,882

27-Jul-10 C tomkins plc Industrials & Chemicals

Canada pension plan Investment Board; and onex partners lp

1.3 18.7 5.7% 3,672

18-mar-10 C ratiopharm gmbh


teva pharmaceutical Industries ltd

Vem Vermogensverwaltung gmbh

2.3 3,625

08-Apr-10 p Iberia lineas Aereas de espana SA

transportation British Airways plc 0.9 0.9% 3,598

24-Jun-10 C AXA SA (Uk life and pensions businesses)

Financial Services

resolution limited AXA SA 20.4 3,330

20-Jan-10 C Areva t&D SA Industrials & Chemicals

Schneider electric SA; Alstom SA

AreVA SA 0.6 3,180

21-Jul-10 p SSl International plc

Consumer reckitt Benckiser plc 3.4 19.5 37.4 32.8% 3,046

24-Feb-10 C edenred SA Business Services

Accor SA (Shareholders)

Accor SA 3.7 9.2 2,937

C = Completed; p = pending; l = lapsed Source: mergermarket

top DeAlS & eXpeCteD DeAlS

36

europe

Monthly M&A Insider

pIpelIne of europeAn expecTed deAlssituation Target company sector potential bidder company financial adviser to

bidder (b); target (T); seller (s)

seller company Market cap/est. value

(€m)

comments

potential takeover target

Compagnie europeenne de prevoyance

Financial Services

pAI partners 800 Compagnie europeenne de prevoyance (Cep group) and sponsor pAI partners are entertaining pitches from banks to advise and arrange financing packages backing a possible sale of the business.

expected deal

Demag Cranes Ag


konecranes oyj rothschild (t); perella Weinberg partners (B)

762 konecranes has not considered making a hostile bid for germany’s Demag Cranes and it is 'extremely keen' to have full consent for any takeover, said a source close to the situation.

potential takeover target

readymix plc Construction Davy Corporate Finance (t)

Cemex SA de CV 26 Cemex, the listed mexican cement and aggregates company, is in talks to sell its listed Ireland-based subsidiary readymix, said a Cemex spokesperson.

note: expected deals based on confirmed announcements by companies involved Source: mergermarket

top DeAlS & eXpeCteD DeAlS

Top 5 europeAn Announced deAls of The MonTh sep-10Announced status Target company sector bidder company seller company exit multiples (x) bid premia


(€m)revenue ebITdA p/e

07-Sep-10 p electricite de France SA (Uk-based distribution network)


Cheung kong Infrastructure holdings limited; hongkong electric holdings limited; li ka Shing (overseas) Foundation; and li ka Shing Foundation limited

eDF energy plc 6,994

25-Sep-10 p Caja de Ahorros de Asturias

Financial Services

Caja de Ahorros del mediterraneo

4,928

12-Sep-10 p Deutsche postbank Ag (70.05% stake)

Financial Services

Deutsche Bank Ag 71.4 -7.5% 3,882

17-Sep-10 p Sunrise Communications Ag

tmt CVC Capital partners limited

tDC A/S 1.9 7.5 2,533

15-Sep-10 p energa S.A. (84.19% stake)


pge polska grupa energetyczna S.A.

ministry of treasury of the republic of poland

1,915

C = Completed; p = pending; l = lapsed Source: mergermarket

37

europe

Monthly M&A Insider

leAgUe tABleS

VAlUeyTd


(€m)deal count


2 Jpmorgan 119,915 66



5 Bank of America merrill lynch 81,767 37






11 Sg 53,970 27


13 royal Bank of Scotland group 50,126 18

14 rBC Capital markets 48,436 24

15 lazard 41,533 82

16 Santander global Banking and markets 39,176 11

17 tD Securities 33,692 6

18 nomura holdings 32,541 31

19 Blackstone group holdings 29,466 5

20 greenhill & Co 22,431 11Source: mergermarket

VolUme

the financial adviser league tables by value and volume have been run from 01-Jan-10 to 30-Sep-10 and exclude lapsed and withdrawn deals. the tables cover all sectors andare based on the geography of either the target, bidder or seller being europe-based.

yTd 30-sep-10

house value (€m)

deal count


2 kpmg 8,993 111


4 pricewaterhouseCoopers 8,547 87

5 Deloitte 6,030 84


7 lazard 41,533 82



10 Jpmorgan 119,915 66



13 DC Advisory partners 4,844 42

14 ernst & Young 1,927 42

15 Bank of America merrill lynch 81,767 37



18 nomura holdings 32,541 31

19 grant thornton Corporate Finance 678 31

20 hSBC Bank 22,201 28Source: mergermarket

Top 20 fInAncIAl AdvIsers

VAlUeyTd


(€m)deal count


2 Skadden Arps Slate meagher & Flom 91,423 41

3 Cleary gottlieb Steen & hamilton 82,519 45


5 linklaters 76,434 131


7 Freshfields Bruckhaus Deringer 61,598 111

8 Allen & overy 60,855 119


10 Cravath Swaine & moore 58,277 12

11 herbert Smith/gleiss lutz/Stibbe 51,955 61


13 Jones Day 43,107 71

14 Clifford Chance 43,021 73

15 latham & Watkins 42,352 59

16 Debevoise & plimpton 38,003 7

17 Stikeman elliott 37,905 14



20 Blake Dawson 34,157 8Source: mergermarket

VolUme

the legal adviser league tables by value and volume have been run from 01-Jan-10 to 30-Sep-10 and exclude lapsed and withdrawn deals. the tables cover all sectors andare based on the geography of either the target, bidder or seller being europe-based.

yTd 30-sep-10

house value (€m)

deal count

1 linklaters 76,434 131

2 DlA piper 16,163 122

3 Allen & overy 60,855 119


5 CmS 14,296 109

6 Clifford Chance 43,021 73

7 Jones Day 43,107 71


9 hogan lovells 15,561 64

10 herbert Smith/gleiss lutz/Stibbe 51,955 61

11 latham & Watkins 42,352 59

12 White & Case 9,531 57

13 mannheimer Swartling 7,067 53

14 SJ Berwin 6,314 51

15 Vinge 4,459 49


17 loyens & loeff 14,591 47


19 Cleary gottlieb Steen & hamilton 82,519 45

20 Cuatrecasas, goncalves pereira 13,356 43Source: mergermarket

Top 20 legAl AdvIsers

38

europe

Monthly M&A Insider

leAgUe tABleS

VAlUe

yTd 30-sep-10

house value (€m)

deal count

1 CVC Capital partners 7,052 6

2 hgCapital 3,987 10

3 Advent International 3,859 6

4 onex partners 3,748 2

5 Bain Capital 2,924 2

6 kohlberg kravis roberts & Co 2,831 5

7 triton partners 2,057 6

8 gS Capital partners 2,000 2

9 Cinven 1,834 3

10 tpg Capital 1,559 2Source: mergermarket

VolUme

the private equity buyout activity tables by value and volume are based on private equity firms advising the bidder on buyout deals where the dominant geography of the target company is europe-based. the tables by value and volume have been run from 01-Jan-10 to 30-Sep-10 and exclude lapsed and withdrawn deals.

yTd 30-sep-10

house value (€m)

deal count

1 hgCapital 3,987 10

2 Sovereign Capital partners 92 7

3 CVC Capital partners 7,052 6

4 Advent International 3,859 6

5 triton partners 2,057 6

6 Barclays private equity 401 6

7 lloyds tSB Development Capital 290 6

8edmond de rothschild Investment partners

183 6

9 naxicap partners 29 6

10 kohlberg kravis roberts & Co 2,831 5Source: mergermarket

Top 10 prIvATe equITy fIrMs by europeAn buyouTs

VAlUe

yTd 30-sep-10

house value (€m)

deal count

1 hgCapital 2,860 2

2 the Carlyle group 2,734 6

3= permira 2,408 2

3= SV life Sciences 2,408 2

5 gS Capital partners 2,408 1

6 Apax partners 2,200 4

7 riverstone holdings 1,759 1

8 Doughty hanson & Co 1,700 2

9 Candover Investments 1,550 3

10 Astorg partners 1,414 3Source: mergermarket

VolUme

the private equity exit activity tables by value and volume are based on private equity firms advising the vendor on exit deals where the dominant geography of the target company is europe-based. the tables by value and volume have been run from 01-Jan-10 to 30-Sep-10 and exclude lapsed and withdrawn deals.

yTd 30-sep-10

house value (€m)

deal count

1 the Carlyle group 2,734 6

2 Barclays private equity 480 6

3 3i group 1,205 5

4 Apax partners 2,200 4

5 lloyds tSB Development Capital 589 4

6 Sigefi private equity 80 4

7 ISIS private equity partners 44 4

8= Capman group - 4

8= perfectis private equity - 4

10 Candover Investments 1,550 3Source: mergermarket

Top 10 prIvATe equITy fIrMs by europeAn exITs

europe


trenD grAphS

europeAn M&A quArTerly Trend

VAlUe VolUme

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

450,000

500,000

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q4 04

Q3 04

Q2 04

Q104

Valu

e (€

m)

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Num

ber

of d

eals

europeAn M&A quArTerly MId-MArkeT Trend

VAlUe VolUme

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Valu

e (€

m)

0

100

200

300

400

500

600

700

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Num

ber

of d

eals

moving average trend line

europe

Monthly M&A Insider

europeAn M&A secTor breAkdown yTd 2010

VAlUe VolUme

0.4%

12.3%0.2%

10.0%

2.3%

1.7%

4.7%

2.4%

8.8%

11.0%

6.0%

13.0%

27.1%


Consumer

TMT

Business Services

Financial Services



Construction

Leisure

Transportation

Real Estate

Agriculture

Defence

15.6%

19.9%

1.0%0.3%3.2% 1.8%

3.7%

6.9%

4.7%

11.0%

9.6%

8.2%

13.2%


Consumer

TMT

Business Services

Financial Services



Construction

Leisure

Transportation

Real Estate

Agriculture

Defence

trenD grAphS

europeAn M&A quArTerly prIvATe equITy Trend

VAlUe VolUme

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

90,000

100,000

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Valu

e (€

m)

European buyouts

European exits

0

50

100

150

200

250

300

350

400

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Num

ber

of d

eals

European buyouts

European exits

40

europe


europeAn M&A deAl sIze breAkdown

VAlUe VolUme

0

50

100

150

200

250

300

350

400

450

500

550

600

650

700

H210*

H110

H209

H109

H208

H108

H207

H107

H206

H106

H205

H105

H204

H104

> €501m

€251m-€500m

€101m-€250m

€15m-€100m

€5m-€14.9m

Valu

e (€

bn)

0

500

1,000

1,500

2,000

2,500

3,000

3,500

H210*

H110

H209

H109

H208

H108

H2 07

H107

H206

H106

H205

H105

H204

H104

> €501m

€251m-€500m

€101m-€250m

€15m-€100m

€5m-€14.9m

Value not disclosed

Num

ber

of d

eals

trenD grAphS

europeAn M&A geogrAphIc breAkdown yTd 2010

VAlUe VolUme

Germany

Benelux

Iberia

Italy

Other

SEE

UK & Ireland

Nordic

CEE

France

26.3%

9.0%

8.8%

14.3%

7.4%

11.3%

9.3%

9.3%

2.7%

3.5%

11.9% 10.7%

7.8%

7.6%

5.7%

22.5%

4.5%

3.0%

14.1%

12.3%

Germany

Benelux

Iberia

Italy

Other

SEE

UK & Ireland

Nordic

CEE

France

42

Mid

dle east &

africa

THE MIDDLE EAST & AFRICA

A MERgERMARkET M&A REpoRT on

Monthly M&A Insider

South Africa and Israel are the most active countries, comprising 30.0% and 26.8% of deal volume for the year-to-date, respectively. So far, Israel has accounted for 51 deals in the region amounting US$2bn, while South Africa has seen 57 deals valued at US$11.5bn.

Deals to watchThe TMT sector continues to see large deals in MEA region. The current quarter may see the largest M&A transaction since 2007 with United Arab Emirates-based state controlled telecom firm Etisalat making a preliminary offer to acquire a 46.00% stake in Zain, the kuwait-based Telecommunication company, in a US$12.00bn deal. The sale comes from the majority shareholder, kharafi group, which stated that it received backing of sufficient number of Zain shareholders to sell the stake. The remaining portion of Zain is owned by kuwait’s sovereign wealth fund. Zain operates in eight countries and serves more than 34.2m users. The acquisition would enable Etisalat to enter into the Iraqi, Bahrain and kuwait telecom markets, as well as give a controlling stake in Zain. Etisalat is looking for US$9.00bn financing for the transaction.

Etisalat is also in talks to acquire a 26.00% stake in the Indian telecom company Reliance Communications in a US$4.00bn transaction. It looks as if Etisalat is looking to expand its operations outside of its domestic markets, especially in the Middle East and Asia. In Mar-10, Zain closed a US$10.70bn deal with Indian Bharti Airtel for its African operations. Qatar Telecom is interested in increasing its stake in Liberty Telecom, the philippine’s-based telecom firm to 40.00%. In 2009, Qatar Telecom made a US$500m initial investment in Liberty Telecom.

Meanwhile, the Iraqi government announced the names of the companies that are going to participate in an auction for the Mansuriyah, Siba and Akkas gas fields which have estimated reserves of 11.23 trillion cubic feet of gas. Some of the bidders include: Total SA, EnI SA, Statoil, Tnk-Bp Holding, korea gas and Turkish petroleum. The rationale behind the sale is that exploitation of the resources is required to meet Iraq’s growing gas demand and to increase exports.

State-owned ChemChina has approached Israeli holding company koor Industries to acquire a 70.00% stake in Makhteshim, the Israeli agrochemicals firm, at a 60.0% premium; this values the company at US$2.72bn. koor is expected to sell a 17.00% stake initially, and will have the option to divest the remaining stake later, at the current deal value, to be updated with a 20.0% premium for each year. koor is owned by nochi Dankner’s IDB group. If the transaction goes through, this would be Dankner’s first major exit since acquiring IDB. ChemChina’s agrochemicals business unit is operated under Blue Star, of which ChemChina owns 80.00%. The remaining stake is held by The Blackstone group.

DeAl ActIvIty overvIew

M&A ACTIvITy HAS BEEn QUIET In THE LAST QUARTER wITH 53 DEALS woRTH US$6.3Bn SInCE Q109. FoR THE yEAR-To-DATE, THE ACTIvITy In vALUE AnD voLUME wERE Up 33.0% AnD 9.5%, RESpECTIvELy, CoMpARED To THE SAME pERIoD In 2009. THE LARgEST DEAL In THE MonTH oF SEpTEMBER wAS ELBIT IMAgIng’S ACQUISITIon oF EnTER HoLDIngS 1 FoR US$217M. FoR THE yEAR-To-DATE, TMT HAS BEEn THE MoST ACTIvE SECToR In THE MEA REgIon By vALUE wITH US$11.8Bn CoMpRISIng 33.0% oF THE ToTAL DEAL voLUME. InDUSTRIAL AnD CHEMICALS wAS THE MoST ACTIvE SECToR By voLUME wITH 36 DEALS.

43

Mid

dle east &

africa

Monthly M&A Insider

target: Enter Holdings 1 Ltd (90.00% stake) Announced: 13-Sep-10

Bidder: Elbit Imaging Ltd Deal value: US$217m

vendor: Deal nature: Domestic, public

• Enter Holdings 1 Ltd has signed a share purchase agreement to be acquired by Elbit Imaging Ltd.

• Enter Holdings 1 Ltd, the listed Israel-based company investment holding company having interest in supermarket operator.

terMs:• Elbit Imaging has acquired 90.00% stake in Enter

Holdings 1 Ltd. The transaction value of 130.1445m Enter Holdings 1 Ltd’s shares at the closing price on 7-Sep-10 is ILS6.30 per share (US$1.66).

• The implied equity value of the transaction is ILS911m (US$241m).

• As a part of consideration, Elbit Imaging will issue InSigthec’s share representing 54.80% of InSightec’s share capital and gamida Cell Ltd’s shares representing 28.30% of gamida’s share capital.

FInAncIng:• Elbit Imaging will issue InSigthec and gamida Cell’s

shares by and raising fund from funds from institutional and private investors.

Post DeAl DetAIls:• post acquisition, Medical Division of Elbit Imaging will

transfer to Enter Holdings 1 and then will be listed on stock exchange.

exPecteD coMPletIon:• The transaction is expected to close on fulfilment of

conditions as mentioned in agreement.

conDItIons:• Enter Holdings 1 Ltd shareholders approval.

BAckgrounD:• Simultaneously, Enter’s controlling shareholders will be

granted by Enter exercise-price free options to purchase a 0.70% interest in Enter (on a fully diluted basis) and Elbit will be entitled to allow additional investors to invest and purchase up to a 10.00% interest in Enter at a valuation of ILS800m (US$212m).

DEAL oF THE MonTH

exit multiples – y/e 30-Jun-10 Premium analysis

Multiples value (us$m) offer price per share (us$) 1.67

revenue 6.5x 37 1 day before n/a

eBItDA - - 1 month before n/a

eBIt 6.5x 37 1 day after 2.67

earnings 0.6x 2.7 Pre-rumour n/a

44

Mid

dle east &

africa

Monthly M&A Insider

toP 15 MIDDle eAstern & AFrIcAn AnnounceD DeAls For ytD 30-seP-10Announced status target company sector Bidder company seller company exit multiples (x) Bid premia

1-day before

Deal value

(us$m)revenue eBItDA P/e

30-Mar-10 C Zain Africa Bv TMT Bharti Airtel Limited Mobile Telecommunications Company k.S.C.

11.2 - 10,700

15-Jul-10 C Dimension Data Holdings plc

TMT nippon Telegraph and Telephone Corporation

0.7 11.5 0.2 18.1% 2,822

18-Feb-10 C Tsogo Sun Holdings pty Ltd

Leisure gold Reef Resorts Limited

Hosken Consolidated Investments Limited; and SABMiller plc

19.7 21.9 59.0 - 2,721

28-Mar-10 p Sonangol Sinopec International Limited (55.00% stake)


Sinopec Corporation Hongkong International Limited

Sinopec overseas oil & gas Limited

- 2,457

31-Mar-10 p Momentum group Limited

Financial Services

Metropolitan Life Limited

FirstRand Limited n/a n/a - 2,408

10-May-10 p Anglo American Zinc Energy, Mining & Utilities

Hindustan Zinc Limited

Anglo American plc 2.0 6.3 - 1,338

25-Mar-10 C Hyprop Investments Limited (66.70% stake)

Real Estate Redefine Income Fund Limited

15.3 2.5% 942

21-Mar-10 C Qatar Shipping Company QSC

Transportation Qatar navigation Company QSC

-24% 917

10-Jan-10 C Qatar Real Estate Investment Co

Real Estate Barwa Real Estate Company QSC

n/a n/a 10.1 30.6% 862

20-Jul-10 p Bp plc (western Desert business concessions and East Badr El-din exploration concession in Egypt)


Apache Corporation Bp plc 650

11-Jul-10 C Aabar Investments pJSC

Financial Services

International petroleum Investment Company

n/a n/a 3.3 545

17-Aug-10 p Credit Libanais SAL (65.00% stake)

Financial Services

EFg-Hermes Holding SAE

Capital Investment Holding SAL; and Capital Investment Holding

n/a n/a 16.3 - 542

20-May-10 C Shadeed Iron & Steel LLC


Jindal Steel & power Ltd

Al ghaith Holding pJSC

- 464

28-Jun-10 p First Finance Company QSC

Financial Services

Barwa Bank n/a n/a 53.3 21.1% 455

10-Mar-10 C Foodcorp (proprietary) Limited (77.00% stake)

Consumer new Foodcorp Holdings (proprietary) Limited

pamodzi Investment Holdings (proprietary) Limited

0.6 5.8 - 453


Top DEALS & ExpECTED DEALS

45

Mid

dle east &

africa

Monthly M&A Insider

situation target company sector Potential bidder company

Financial adviser to bidder (B); target (t); seller (s)

seller company Market cap/ est.

value (us$m)

comments

Expected deal Mobile Telecommunications Company k.S.C.

TMT Emirates Telecommunications Corporation

Morgan Stanley(B), national Bank of kuwait(B), Bnp paribas(v)

Al-khorafi group

11,833 Etisalat has confirmed that it is submitting offer; the main shareholders have welcomed the deal and Etisalat plans to sell Zain Saudi subsidiary.

potential takeover

Sharemax Investments

Real Estate Realcor Holdings 790 Realcor Holdings, the South African property development group, plans to acquire property company Sharemax, according to Business Report.

Expected deal Retail group gulf Consumer Fawaz Abdulaziz Al Hokair Company

19 Fawaz Abdulaziz Al Hokair extends deadline to acquire stakes in Retail group gulf.

Expected deals based on confirmed announcements by companies involved

PIPelIne oF MIDDle eAstern & AFrIcAn exPecteD DeAls

Top DEALS & ExpECTED DEALS

toP 5 MIDDle eAstern & AFrIcAn AnnounceD DeAls oF the Month seP-10Announced status target company sector Bidder company seller company exit multiples (x) Bid premia

1-day before

Deal value

(us$m)revenue eBItDA P/e

13-Sep-10 p Enter Holdings 1 Ltd (90.00% stake)

Financial Services

Elbit Imaging Ltd 6.5 0.6 217

19-Sep-10 C gulf Insurance Company (39.20% stake)

Financial Services

Fairfax Financial Holdings Limited

kuwait projects Company (Holding), kuwait

n/a n/a 29.5 58.3% 209

03-Sep-10 p Formula Systems (1985) Ltd (49.19% stake)

TMT Asseco poland SA Emblaze group 0.5 4.9 20.47 48.7% 107

22-Sep-10 C 3g Mobile bandwidth licence in Tunisia

TMT Tunisie Telecom government of Tunisia 80

21-Sep-10 p Lightech Electronic Industries ltd


Carmanah Technologies Corporation

1.0 20


46

Mid

dle east &

africa

Monthly M&A Insider

LEAgUE TABLES

vALUEytD


(us$m)Deal count




4 Standard Chartered 11,875 4

5 HSBC Bank 11,617 3



8= global Investment House kSCC 10,700 1

8= State Bank of India 10,700 1

10 Rand Merchant Bank 7,411 9

11 JpMorgan 5,201 6

12 Royal Bank of Scotland group 4,933 2

13 Commerzbank 4,933 1

14 Lazard 4,795 5

15 Deutsche Bank 4,596 4Source: mergermarket

voLUME

The financial adviser league tables by value and volume have been run from 01-Jan-10 to 30-Sep-10 and exclude lapsed and withdrawn deals. The tables cover all sectors and are based on the geography of either the target, bidder or seller being Middle East (including Israel) & African-based.

ytD 30-sep-10

house value (us$m)

Deal count


2 Rand Merchant Bank 7,411 9


4 JpMorgan 5,201 6

5 Investec 4,103 6

6 Ernst & young 559 6


8 Lazard 4,795 5

9 Citigroup 1,638 5

10 Deloitte 200 5


12 Standard Chartered 11,875 4


14 kpMg 537 4

15 Rothschild 308 4Source: mergermarket

toP 15 FInAncIAl ADvIsers – MIDDle eAst & AFrIcA

vALUEytD


(us$m)Deal count





5 Talwar, Thakore and Associates 10,700 1

6 Edward nathan Sonnenbergs 9,637 9

7 webber wentzel 7,488 11




11= goERg Rechtsanwaelte 4,933 1

11= kirkland & Ellis 4,933 1

11= noerr 4,933 1

11= willkie Farr & gallagher 4,933 1


Source: mergermarket

voLUME

The legal adviser league tables by value and volume have been run from 01-Jan-10 to 30-Sep-10 and include lapsed and withdrawn deals. The tables cover all sectors and are based on the geography of either the target, bidder or seller being Middle East (including Israel) & African-based.

ytD 30-sep-10

house value (us$m)

Deal count

1 webber wentzel 7,488 11



4 Edward nathan Sonnenbergs 9,637 9

5 werksmans 969 9


7 Bowman gilfillan 1,702 7




11 white & Case 1,423 5

12 DLA Cliffe Dekker Hofmeyer 785 5

13 gibson Dunn & Crutcher 735 5

14 Baker & Mckenzie 200 5

15 CMS 686 4Source: mergermarket

toP 15 legAl ADvIsers – MIDDle eAst & AFrIcA

47

Mid

dle east &

africa

Monthly M&A Insider

LEAgUE TABLES

vALUE

vALUE

ytD 30-sep-10

house value (us$m)

Deal count

1 Capitau SA 453 1

2 Israel Infrastructure Fund 125 1

3 Actis Capital 30 1

4 Tene Capital 23 1

5 Capinnova Investment Bank 20 1Source: mergermarket

voLUME

The private equity buyout activity tables by value and volume are based on private equity firms advising the bidder on buyout deals where the dominant geography of the target company is Middle East (including Israel) & African-based. The tables by value and volume have been run from 01-Jan-10 to 30-Sep-10 and exclude lapsed and withdrawn deals.

ytD 30-sep-10

house value (us$m)

Deal count

1 Capitau SA 453 1

2 Israel Infrastructure Fund 125 1

3 Actis Capital 30 1

4 Tene Capital 23 1

5 Capinnova Investment Bank 20 1Source: mergermarket

toP 5 PrIvAte equIty FIrMs By MIDDle eAstern & AFrIcAn Buyouts

vALUEytD 30-sep-10

house value (us$m)

Deal count

1 pitango venture Capital 100 2

2 Cedar Fund 89 2

3 Evergreen venture partners 29 2

4 pamodzi Investment Holdings 453 1

5= Francisco partners Lp 230 1

5= Sequoia Capital 230 1Source: mergermarket

voLUME

The private equity exit activity tables by value and volume are based on private equity firms advising the vendor on exit deals where the dominant geography of the target company is Middle East (including Israel) & African-based. The tables by value and volume have been run from 01-Jan-10 to 30-Sep-10 and exclude lapsed and withdrawn deals.

ytD 30-sep-10

house value (us$m)

Deal count

1 pitango venture Capital 100 2

2 Cedar Fund 89 2

3 Evergreen venture partners 29 2

4 pamodzi Investment Holdings 453 1

5= Francisco partners Lp 230 1

5= Sequoia Capital 230 1Source: mergermarket

toP 5 PrIvAte equIty FIrMs By MIDDle eAst & AFrIcA exIts

48

Mid

dle east &

africa

Monthly M&A Insider

TREnD gRApHS

MIDDle eAst & AFrIcA M&A quArterly trenD

vALUE voLUME

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Valu

e (U

S$m

)

0

30

60

90

120

150

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Num

ber

of d

eals

MIDDle eAst & AFrIcA M&A quArterly MID-MArket trenD

vALUE voLUME

0

1,000

2,000

3,000

4,000

5,000

6,000

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Valu

e (U

S$m

)

0

10

20

30

40

50

60

70

80

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q4 08

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Num

ber

of d

eals


49

Mid

dle east &

africa

Monthly M&A Insider

TREnD gRApHS

MIDDle eAst & AFrIcA M&A sector BreAkDown ytD 2010

vALUE voLUME

5.5%

0.5%0.5%

4.4%

15.1%

8.7%

3.3%

1.6%

15.7%

8.7%

1.2%2.6%

32.6%


Financial Services

Business Services

Consumer

Energy, Mining & Utilites

TMT

Leisure

Transportation


Construction

Real Estate

Agriculture

Defence

17.1%

15.2%

8.1%

15.2%

2.4%

0.5%2.4%

4.7%4.3%

4.3%

2.4%

13.7%

10.0%


Financial Services

Business Services

Consumer

Energy, Mining & Utilites

TMT

Leisure

Transportation


Construction

Real Estate

Agriculture

Defence

MIDDle eAst & AFrIcA M&A quArterly PrIvAte equIty trenD

vALUE voLUME

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q306

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Valu

e (U

S$m

)

Middle East& Africa buyouts

Middle East& Africa exits

0

2

4

6

8

10

12

14

16

18

20

Q310

Q210

Q110

Q409

Q309

Q209

Q109

Q408

Q308

Q208

Q108

Q407

Q307

Q207

Q107

Q406

Q 06

Q206

Q106

Q405

Q305

Q205

Q105

Q404

Q304

Q204

Q104

Num

ber

of d

eals

Middle East& Africa buyouts

Middle East& Africa exits

50

Mid

dle east &

africa

Monthly M&A Insider

TREnD gRApHS

MIDDle eAst & AFrIcA M&A geogrAPhIc BreAkDown ytD 2010

vALUE voLUME

6.8%

3.0%4.1%

0.7% 0.2%0.1%

0.2%

31.7%

1.4%4.6%

2.7%

5.6%

0.6%1.5%

6.2%

29.9%

South Africa

Israel

Egypt

United Arab Emirates

Kuwait

Qatar

Saudi Arabia

Oman

Nigeria

Jordan

Angola

Namibia

Lebanon

Zambia

Tunisia

Sierra Leone

Syrian Arab Republic

Libya

Zimbabwe

Mozambique

1.6%

30.0%

26.8%

8.4%

7.4%

4.7%

3.2%

3.2%

2.6%2.1%

2.1%

2.1%

1.6%1.6%

1.6%1.1%

South Africa

Israel

Egypt

United Arab Emirates

Kuwait

Qatar

Saudi Arabia

Oman

Nigeria

Jordan

Congo

Angola

Namibia

Lebanon

Syrian Arab Republic

Tunisia

MIDDle eAst & AFrIcA M&A DeAl sIZe BreAkDown

vALUE voLUME

0

10

20

30

40

50

60

H210*

H110

H209

H109

H208

H108

H207

H107

H206

H106

H205

H105

H204

H104

> US$501m

US$251m-US$500m

US$101m-US$250m

US$15m-US$100m

US$5m-US$14.9m

Valu

e ($

bn)

0

50

100

150

200

250

H210*

H110

H209

H109

H208

H108

H207

H107

H206

H106

H205

H105

H204

H104

> US$501m

US$251m-US$500m

US$101m-US$250m

US$15m-US$100m

US$5m-US$14.9m

Value not disclosed

Num

ber

of d

eals

www.mergermarket.comRemark, Part of The Mergermarket Group

80 StrandLondon, WC2R 0RLUnited Kingdom

t: +44 (0)20 7059 6100f: +44 (0)20 7059 [email protected]

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t: +1 212 686-5606f: +1 212 [email protected]

Suite 2401-3Grand Millennium Plaza181 Queen’s Road, CentralHong Kong

t: +852 2158 9700f: +852 2158 [email protected]

Disclaimer

This publication contains general information and is not intended to be comprehensive nor to provide financial, investment, legal, tax or other professional advice or services. This publication is not a substitute for such professional advice or services, and it should not be acted on or relied upon or used as a basis for any investment or other decision or action that may affect you or your business. Before taking any such decision you should consult a suitably qualified professional adviser. Whilst reasonable effort has been made to ensure the accuracy of the information contained in this publication, this cannot be guaranteed and neither Mergermarket nor any of its subsidiaries nor any affiliate thereof or other related entity shall have any liability to any person or entity which relies on the information contained in this publication, including incidental or consequential damages arising from errors or omissions. Any such reliance is solely at the user’s risk.

Remark, the events and publications arm of The Mergermarket Group, offers a range of publishing, research and events services that enable clients to enhance their own profile, and to develop new business opportunities with their target audience.

The following notes pertain to data contained in this publication:

• Deals are included where the deal value is greater than or equal to €5m.

• Where no deal value has been disclosed, deals are included if the turnover of the target is greater than or equal to €10m.

• Deals are included in the graphs and Top Deals in each section based on the dominant geography and dominant sector of the target company. Data underlying the League Tables are based on deals where the bidder, target or parent geography of either is that of the geography in focus.

• H1 2010 refers to the period 01-Jan-10 to 30-Jun-10.

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