The Hindu Business Line : EU M&A deals in EU touche € 164 bn in Oct

LONDON: Driven by a number of banking industry deals, mergers and acquisitions in the European Union reached a whopping €164.03 billion in October, says a report. The total value of the deals struck last month was 50 per cent higher than those announced in September and more than double the size (€ 66,347 million) achieved in October 2007, the Zephyr monthly M&A report on EU countries said.

An analysis of the M&A deals show that nine of the top 10 transactions involved a financial services company. Only three of October's biggest deals did not target that industry. Major deals during the month of October include the Royal Bank of Scotland' s €19,001 million rights issue. This was the month's largest deal and would involve the Edinburgh-based lender selling a 58 per cent stake in its enlarged capital.

The transaction is part of the UK banking industry's rescue plan and would be underwritten by HM Treasury. The government would also subscribe to€ 6,334 million worth of RBS preference shares. Meanwhile, the most valued non-banking deal was the long-awa ited € 4,450 million purchase of German travel and shipping group Hapag-Lloyd.

The credit crisis, however, had a huge impact on private equity deals, as most valuable debt-backed acquisition in October was worth just €500 million. Private equity deal values plummeted by more than two thirds over the said period, reaching a new 12 -month low of € 1,460 million. Around 30 per cent of the top 20 private equity deals were worth less than €10 million and only four deals were worth over €100 million, the report published by BvDEP. - PTI

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