Nordic mergers and acquisitions, already close to last year’s total after four months, will continue to accelerate as takeover financing becomes easier, Danske Bank A/S’s corporate finance chief said.
Industrial companies “have come out of the financial crisis stream-lined, with strong balance sheets and are looking at Nordic assets,” Anders Boending said yesterday in an interview at Danske’s Copenhagen headquarters. “The M&A market is improving, but we’re not back to the peak level from before the financial crisis.”
In the first quarter, announced Nordic M&A deals doubled in value to $25.4 billion from the year-earlier period, data compiled by Bloomberg show. The value of European deals rose 19 percent to $261 billion and U.S. deals increased 18 percent to $354 billion. Last week, DuPont Co., the third-largest U.S. chemicals maker, said it will complete a $6.36 billion acquisition of Danish food-ingredient maker Danisco A/S.
“Lending is easing and that’s benefitting M&A, in particular for private equity,” Boending said. Danske, which has 60 people in its corporate finance unit, advised on 11 takeover deals last year ranking it the region’s fifth-busiest local bank.
The value of announced Nordic merger transactions so far this year is $61.2 billion compared with $79.1 billion for the whole of 2010.
Fewer Nordic companies will sell shares this year, Boending said. The value of Nordic initial public offerings is $2.82 billion so far this year. In 2010 the region was home to 4 of the 10 biggest share sales in western Europe, according to Bloomberg data.
“We’re still talking to clients about IPOs, but the timing will be unpredictable,” Boending said. “Global incidents are having a bigger impact on the market than previously.”
ISS Holding A/S, the world’s biggest cleaning service provider, withdrew a $2.55 billion IPO on March 17, citing a slump in equity markets caused by political unrest in northern Africa and Japan’s nuclear disaster.
ISS is still talking with its banks, which include Danske, about the timing of a new IPO attempt, Jeff Gravenhorst, chief executive officer of the Copenhagen-based company, said in a May 12 interview.
Stockholm-based SEB AB advised on the most deals in 2011, with 32 Nordic transactions. The region had a total of 1,051 deals last year.