Mergers and acquisitions activity in Australia is about to surpass the boom year of 2014, according to early back room deal data aggregated by Intralinks.
The level of activity is high despite a slowing in mining and metals industry deals. Many of the replacement mergers and acquisitions are coming from high tech.
“We’re seeing early stage deals up about 14% over the last 12 months just in Australia alone,” Philip Whitchelo at Intralinks told Business Insider. “This gives an early indication that healthy M&A deals are going to happen within the next six months.”
Intralinks, which runs virtual deal rooms where parties to M&A can lodge confidential documents, says the Asia-Pacific region and Australia are off to a flying start, with the value of announced deals in the March quarter up over 50% year-on-year.
Last year was also a bumper year in Australia for raising capital on the stock market, $26 billion in equity through 74 IPOs.
Whitchelo, the London-based head of strategy, says the sectors with the most deals are some not well known for mergers and acquisitions in Australia.
“It’s been the metals and the mining industry which has dominated inbound M&A over the last ten years,” he says.
“That sector has really flipped in terms of its importance. What’s happened is that Australian M&A has done a fantastic job of rebalancing away from the metal and mining sector and toward other sectors.
“If you look at some of our data, and also we have data on announced deals, it’s been sectors such as technology, real estate, consumer, industrials and manufacturing. These have taken up the slack and led to continued growth in M&A.”
According to the Intralinks March quarter report, the Asia-Pacific region will continue to perform above 2014 level, with the strongest growth in M&A activity in Australia/New Zealand, Southeast Asia and South Korea.
The Intralinks report shows that the region has seen a 286% increase in early-stage high technology deals. Other sectors showing strength include manufacturing, industrials and consumer.