Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 

Russell McVeagh's M&A expectations for 2019


20 February 2019


Leading law firm Russell McVeagh has today released its M&A trends for 2019 publication that looks back at its forecasts for 2018, which all largely eventuated, and considers what 2019 holds in store.

Corporate partner Ben Paterson says, "2018 was a strong year for M&A, and we see that continuing into 2019 despite some increased global uncertainty. In terms of particular trends, we think we will see an increase in non-bank lending, the predominance of private equity led transactions will likely continue, and take private transactions remaining popular."

Predictions for 2019 include:

Increased global uncertainty
Global economic uncertainty may impact M&A activity, which will soften as 2019 continues. Given the expected slow-down in growth, demand may decrease for businesses in growth-sensitive sectors (such as technology) while demand for businesses in recession-resilient sectors (such as food and beverage and infrastructure) may increase.

Continuation of take private transactions
Due to the somewhat late stage of the economic cycle, strong overseas demand for growth opportunities, the relatively weak(er) NZ dollar, and the fundraising levels achieved by private equity sponsors, the recent surge in take private transactions is expected to continue. We also hope to see some IPOs later in the year to at least partially offset the significant reduction in the number of companies listed on the NZX.

Private equity run continues
With debt funding remaining relatively cheap, and private equity funds still with significant volumes of committed (but uncalled) capital at their disposal, private equity sponsors are expected to remain acquisitive in New Zealand in 2019 and beyond. Further, a number of portfolio entities owned by New Zealand private equity are likely to come up for sale.

W&I Insurance
The uptake of warranty insurance is expected to continue, as more Asia based funds and Asian corporates become familiar with the product. That said, insurers are carving out some key risk areas and, if this trend continues, the utility of W&I insurance may begin to be called into question, or used in conjunction with other security.

Sectors of focus
Financial services, FMCG, Infrastructure and Agri-business are expected to command attention this year.

Russell McVeagh's M&A Trends for 2019 publication is available to view here.

Russell McVeagh's M&A Trends for 2018 publication is available to view here.

ENDS

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Toxicology Tests Planned: Dead Rats Washed Up On Beaches

As many as 600 rats washed up on Westport's North Beach over the weekend to the horror of locals. DOC said they may have been killed by a recent 1080 poison drop 140km away and washed down the Buller River after heavy rain battered the coast. More>>

ALSO:

Transition To Low Carbon: Mineral And Petroleum Resource Strategy

Responsibly Delivering Value – A Minerals and Petroleum Strategy for Aotearoa New Zealand: 2019-2029 has been developed to provide the direction for the sector in the transition to a low carbon and productive, sustainable and inclusive economy. More>>

ALSO:

MethaneSAT: Methane Satellite Mission Control In New Zealand

Mission Control for an international space mission to help tackle climate change will be based in New Zealand, with the Government putting $26 million towards the state-of-the-art satellite...More>>

ALSO:

Real Estate: Late Spring Surge

The continued shortage of quality real estate listings, coupled with record low mortgage interest rates have combined to add some zing to the property market over October. More>>

Wellbeing Stats: Finances Less Terrible And Less Great

According to results from the General Social Survey, the proportion of people who felt they had enough or more than enough money to meet everyday needs increased from 51 percent in 2008 to 63 percent in 2018, Stats NZ said today. More>>

ALSO: