To The Moon

KeyPoints:

• Recent M&A info of companies

• The benefits of M&A for companies

• Will Can M&A continue its pace in 2022?

Yesterday(April 07, 2022) ,Drug Maker$Pfizer(PFE)$ and ReViral Ltd. announced that they have entered into a definitive agreement under which Pfizer will acquire ReViral, a privately held, clinical-stage biopharmaceutical company focused on discovering, developing, and commercializing novel antiviral therapeutics that target respiratory syncytial virus (RSV) in a $525m deal.$(PFE)$ rose 4.33% on Thursday, gaining the largest one-day rise in 2022. Before this deal, On March 14, 2022, Pfizer concludes the Arena Pharmaceuticals acquisition for $6.7bn.

The same day, DMS giant $CDK Global(CDK)$ announced it agreed to be acquired by investment firm Brookfield Business Partners in a deal valued at $8.3 billion that would take the publicly traded dealership software giant private.

Brookfield will purchase all of CDK's outstanding shares, with CDK shareholders receiving $54.87 per share in cash when the transaction closes, expected in the third quarter.The price would reflect a 30 percent premium to CDK's closing share price on Feb. 18, CDK shares rose 11.3% to close at $54.50 on Thursday.

Another popular acquisition deal being discussed on WSB is about The Learning technology company $Houghton Mifflin Harcourt(HMHC)$ has completed its stock purchase agreement with private equity investment firm Veritas Capital.

Yesterday, We've talked about the Global M&A Deals Step on the Brakes: The Top 10 Cases in Q1. Some data seems not as fancy as the data in the same period of 2021.

Regarding the M&A performance in 2021,it was described as a white-hot year for deal-making, and M&A has become more complex than ever. Financial investors, SPACs, and Venture Capitals experienced tremendous growth.

The number of announced deals exceeded 62,000 globally in 2021, up an unprecedented 24% from 2020. Strategic M&A also had a remarkable year, deal value was up almost 50%, while record-high valuations raised the bay for success.Alternative Deal Activity also, as strategic buyers pursued more joint ventures, partnerships, and corporate venture capital than ever before.From the above Charts, the Total M&A deal value reached all-time highs of $5.9 trillion in 2021. Strategic deals (including both corporate deals and add-ons) saw value reach $3.8 trillion, an increase of 47% over 2020, fueled by record valuations.

In general, the benefits of M&Afor companies are:

• Compared with the accumulation of the company itself, the M&A can quickly complete the centralization of production, manufacturing, and the industrialization of operation in a short period of time.

• Compared with creating a new company, company acquisition can reduce capital expenditure.

• It is beneficial to reduce the same commodity's excessive market competition and improve the efficiency of industrial chain institutions.

• It is beneficial to adjust the product structure, strengthen the advantages and eliminate the inferior products, strengthen the formation of pillar industries, and promote the adjustment of product structure.

Usually, positive M&A often leads to positive returns for shareholders.

3.Will Can M&A continue its pace in 2022?

Bain& Company's outlook is optimistic: The fundamentals for deal-making are still attractive. A well-balanced mix of market signals suggests the momentum is not slowing down. In order to compete, strategic M&A teams will need to expand their toolkit.

Brian Levy, the Global Deals Industries Leader, Partner of PwC US highlighted: "Deal-making will likely remain robust in 2022, with fierce competition among corporates, PE, and SPACs, but it’s feasible that the top may come off the market, given increasing macroeconomic and regulatory headwinds.”

We don’t expect these records to be smashed in 2022. But all the indications point to another supercharged year. Economic optimism remains high, there’s a strong deals pipeline, capital is in abundance, and companies across all industries badly need technology.

As higher interest rates, rising inflation, increased taxes, and greater regulation could introduce structural or financial hurdles or delays for deals in 2022. We are already seeing greater volatility in financial markets, further disruptions in the global supply chains and increased levels of fiscal debt, as shock waves from the pandemic continue to play out globally. It is true that there are growing AMD$AMD(AMD)$ headwinds.

Who you believe more?

There are also some recent M&A news as follows, please pay attention to relevant stock moves:

1. Australian gas producer $Woodside Petroleum Ltd.(WOPEY)$ agreed merger with $BHP Billiton(BHP)$ petroleum arm is in the best interest of its shareholders, an independent expert said, valuing the combined group at around $40 billion.
2. $Spirit Airlines(SAVE)$ to start talks with $JetBlue Airways(JBLU)$ on its $3.6-billion bid.

Besides that, below are the deals that conclude in Q1 2022:

1. March 17, 2022, $Amazon.com(AMZN)$ has completed its $8.5 billion acquisition of MGM Studios$Ballast Small/Mid Cap ETF(MGMT)$ .
2. March 4, 2022, $Microsoft(MSFT)$ completed its $19.7 billion acquisition of voice technology company Nuance Communications.
3. Feb. 28, 2022, S&P Global Completes Merger with IHS Markit with an enterprise value of approximately $140 billion, Creating a Global Leader to Power the Markets of the Future.
4. Feb 14,2022, Semiconductor designer $(AMD)$ closes record chip industry deal with estimated $50 billion purchase of $Xilinx(XLNX)$ ,
5. Jan 31, 2022, Faurecia$Faurecia SA(FURCF)$ completes $6 billion acquisition of Hella to boost EV, self-driving businesses, the newly merged group FORVIA was formally established on February 7 and became the seventh-largest automotive technology player in the world. supplier.