PwC reports transportation and logistics deal activity turns in solid third quarter output
November 13, 2012
In its recently released report, “Intersections: Third Quarter 2012 global transportation and logistics industry mergers and acquisitions analysis,” Pricewaterhouse Coopers (PwC) reported that even with a difficult global economy, transportation and logistics activity in the third quarter was strong.
Deals cited by PwC in the Intersections report represent all announced deals for the quarter-as opposed to completed deals only-and the report does not parse out deals that are withdrawn, intended, or pending.
Third quarter deal value—for deals valued at $50 million or more—was $15.3 billion and represents 37 announced deals with an average deal value of $413 million. There were fewer announced deals than the 50 from the third quarter of 2011, which totaled $16.3 million. Average deal value in the third quarter of $413 million was ahead of the second quarter’s $284 million and the third quarter of 2011’s $325 million.
“The deal numbers are down but not significantly,” said Jonathan Kletzel, U.S. transportation and logistics advisory leader for PwC, in an interview. “What we believe is influencing the deal making market is uncertainty in the Eurozone which was countered by an increase in U.S. activity.
PwC transportation analyst Michael Portnoy cited how transportation infrastructure-related deals played a role in deal-making activity as they typically attract high investor interest in some certain environments.
The report stated that PwC expects transportation infrastructure investment M&A is expected to be a market leader due to auctions under consideration in the U.S., Philippines, and the European Investment Bank’s 2020 Projection Bond Initiative.
Kletzel said that these things, coupled with the overall challenge presented by transactions budget gaps should lead to increased infrastructure activity on a global basis.
Of the 45 announced fourth quarter deals, 11 involved U.S.-based targets or acquirers, totaling $6.1 billion.
The breakdown by mode for deals valued at $50 million or more in the first quarter was as follows: 16 percent shipping, 16 percent passenger air; 30 percent, passenger ground, 14 percent logistics, 11 percent trucking, 5 percent, rail, and 8 percent other.
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