7 Biggest M&A Deals of 2012

by Dan Burrows | December 27, 2012 1:04 pm

[1]The slowest year for mergers and acquisitions since the depths of the financial crisis finally picked up steam in the final three months of 2012, but the headline deal figures were still small beer compared with what the market used to enjoy.

Total transaction value for 2012 was down about 10% versus the previous year to $2.19 trillion, according to Bloomberg data, but almost $700 billion of that total came in just the last three months — good for the hottest deal activity since the third quarter of 2008.

Yes, companies are sitting on record levels of cash, and corporate borrowing costs are essentially at historic lows. But the crisis in eurozone and, more recently, the stalemate over the U.S. fiscal cliff have put a damper on M&A.

Think about it: How many of the megadeals of 2012 can you rattle off the top of your head?

Nothing hit the headlines like Berkshire Hathaway‘s (NYSE:BRK.A[2]; NYSE:BRK.B[3]) $44 billion deal for Burlington Northern Santa Fe did back in 2009. Or even last year’s boffo $25.5 billion deal when Duke Energy (NYSE:DUK[4]) bought Progress Energy.

Indeed, the biggest deal of 2012 — and it was a big one — didn’t involve any U.S.-listed companies. Have a look at the seven biggest M&A deals of 2012 and see which ones ring a bell:

  1. Glencore International bought Xstrata for $34 billion to create the world’s fourth-largest mining company — too bad for U.S. investors that both stocks are listed only on the London Stock Exchange.
  2. In a tie-up of cell-phone companies, MetroPCS (NYSE:PCS[5]) agreed to a $29 billion merger with Deutsche Telekom‘s (PINK:DTEGY[6]) T-Mobile.
  3. Japanese telecom giant Softbank (PINK:SFTBY[7]) struck a deal to buy 70% of Sprint (NYSE:S[8]) for about $20 billion.
  4. Canadian energy company Nexen (NYSE:NXY[9]) agreed to a $15 billion takeout by CNOOC (NYSE:CEO[10]), the Chinese oil and natural gas giant.
  5. Consolidation came to diversified makers of electrical products when Eaton (NYSE:ETN[11]) acquired Cooper Industries for nearly $12 billion.
  6. The New York Stock Exchange’s 220-year history[12] as an independent company came to an end when parent NYSE Euronext (NYSE:NYX[13]) accepted an $8.2 billion bid from IntercontinentalExchange (NYSE:ICE[14]).
  7. Mining giant Freeport-McMoRan Copper & Gold (NYSE:FCX[15]) returned to its energy roots when it struck a deal to buy Plains Exploration & Production Company (NYSE:PXP[16]) for $6.9 billion.

At any rate, the recent uptick in deal activity might just indicate that the M&A drought is coming to an end. If that turns out to be the case, it should help support valuations and share prices in 2013.

As of this writing, Dan Burrows did not hold positions in any of the aforementioned securities.

  1. [Image]: https://investorplace.com/hot-topics/best-of-2012-and-2013/
  2. BRK.A: http://studio-5.financialcontent.com/investplace/quote?Symbol=BRK.A
  3. BRK.B: http://studio-5.financialcontent.com/investplace/quote?Symbol=BRK.B
  4. DUK: http://studio-5.financialcontent.com/investplace/quote?Symbol=DUK
  5. PCS: http://studio-5.financialcontent.com/investplace/quote?Symbol=PCS
  6. DTEGY: http://studio-5.financialcontent.com/investplace/quote?Symbol=DTEGY
  7. SFTBY: http://studio-5.financialcontent.com/investplace/quote?Symbol=SFTBY
  8. S: http://studio-5.financialcontent.com/investplace/quote?Symbol=S
  9. NXY: http://studio-5.financialcontent.com/investplace/quote?Symbol=NXY
  10. CEO: http://studio-5.financialcontent.com/investplace/quote?Symbol=CEO
  11. ETN: http://studio-5.financialcontent.com/investplace/quote?Symbol=ETN
  12. The New York Stock Exchange’s 220-year history: https://investorplace.com/2012/12/nyse-finds-an-8-2-billion-escape/
  13. NYX: http://studio-5.financialcontent.com/investplace/quote?Symbol=NYX
  14. ICE: http://studio-5.financialcontent.com/investplace/quote?Symbol=ICE
  15. FCX: http://studio-5.financialcontent.com/investplace/quote?Symbol=FCX
  16. PXP: http://studio-5.financialcontent.com/investplace/quote?Symbol=PXP

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