November 16, 2022

M&A Leaks Report: 2021 Deals Leaked More Than in Prior Years

Intralinks recently published its M&A Leaks Report, which analyzes deal leaks over the period from 2009-2021, 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:

– 8.8% of all deals announced during 2021 involved a leak compared to 8.2% during 2020. These were both above the 7.8% average for all years dating back to 2009.

– The total value of leaked deals was up 105% in 2021 ($142 billion) vs. 2020 ($69 billion). The average dollar value of leaked deals was also up 60% in 2021 ($1.7 billion) vs. 2020 ($1.1 billion).

– The three sectors with the highest amount of pre-announcement abnormal trading activity in 2021 vs. 2020 were Healthcare (12.5%), Retail (11.9%) and Industrials (11.3%). None of these cracked the top three on average over the last several years, and their prominence may reflect the challenges and opportunities that companies in these sectors faced during the pandemic.

As always, one of the most interesting findings was the extent to which takeover premiums for target companies involved in leaked deals exceeded those paid in more stealthy transactions. In 2021, the median premium for leaked deals was 54.3%, which was nearly twice the 27.7% premium paid in non-leaked deals. Deals with leaks also closed over a week faster than those that didn’t leak. The median time to closing for a leaked deal was 92 days, compared with approximately 100 days for non-leaked deals.

John Jenkins