Canadian M&A activity soars on surge in outbound deal flow

Thu Jan 7, 2016 9:44am EST
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By Euan Rocha and John Tilak

TORONTO Jan 7 (Reuters) - A slew of major bets outside Canada by some of the country's top pension funds, banks, investment management firms and insurers propelled Canadian deal activity to its second-highest level ever in 2015.

Thomson Reuters data released on Thursday showed $278.69 billion of deal activity involving Canadian entities in 2015, up 37 percent from a year ago, and lagging only a pre-crisis high hit in 2007.

JPMorgan, lead advisor to General Electric on the sale of its finance assets, claimed top spot in the Canadian M&A league tables as big parts of that GE portfolio were scooped up by Canadian institutions like Canada Pension Plan Investment Board, Bank of Montreal and Element Financial.

"The real story around Canadian M&A activity this year was the outbound activity that was up some 175 percent and drove the lion's share of activity" said John Armstrong, head of Canadian M&A at BMO Capital Markets.

Morgan Stanley, Royal Bank of Canada, Bank of America and BMO rounded out the top five in Canada, with other international banks like Citigroup, Credit Suisse and Barclays, placing high in the rankings.

Among the domestic banks CIBC came in third, and a new player, INFOR, emerged as the top independent Canadian investment bank.

"The continuing emergence of the Canadian pension funds as top-tier dealmakers on the global stage was solidified in 2015," said Ron Lloyd, head of Credit Suisse Canada.

"Our pipeline remains very strong," said Barclays Canada head Bruce Rothney, adding he expects Canadian pension funds to look at further resource sector investments as commodity prices hover around cyclical lows.   Continued...