October 23, 2019

M&A Leaks Report: Less Gabby Trend Continued in 2018

Intralinks recently released its annual “M&A Leaks Report.” Once again, the report makes for interesting reading – it analyzes deal leaks over the period from 2009-2018, and breaks them down by world region, country & business sector. The report also looks into the effect of leaks on the premiums paid, emergence of rival bidders & time to closing. Here are some of the highlights:

 – Worldwide, the rate of M&A deal leaks fell in 2018 for the second consecutive year. 7.4% of deals in 2018 involved a leak of the deal prior to its public announcement, compared to 7.9% in 2017 and 8.6% in 2016.

– The fall in the overall worldwide rate of deal leaks in 2018 was driven solely by the Asia-Pacific (APAC) region, where leaked deals declined to 7.9% from 10.8%. Both the Americas and Europe, the Middle East and Africa (EMEA) saw increases in the rate of deal leaks in 2018 of 0.5 and 0.4 percentage points, respectively.

– APAC remains the region with the highest rate of deal leaks, followed by the Americas at 7.6 percent and EMEA at 5.8 percent.

One recurring theme of the annual survey is that leaky deals have always exceeded their more stealthy counterparts when it comes to takeover premiums. From 2009-2018 the median takeover premium for leaked deals was 44% vs. 25% for non-leaked deals, a difference of almost 19 percentage points. In 2018 targets in leaked deals achieved a median takeover premium of 51% vs. 20% for non-leaked deals, a difference of approximately 31 percentage points. The difference was only around 11 percentage points in 2017.

John Jenkins