Deal Capsule Transactions in Chemicals & Life Sciences April 2018
“
We envisage continued strength in Life Sciences M&A, driven by liquidity and deeper focus in therapeutic areas.
”
vir lakshman | Head of chemicals & pharmaceuticals, KPMG IN Germany
highlights
figure 1: Trends in lIFE sCIENCES M&A
—— M&A activity remains robust, despite a decline in chemicals deal value.
1,840
1,830
—— Chemicals saw one of the largest financial investors deals.
119
152
—— Digitalization, in particular, is driving transactions and cooperations with technology players.
2012
2,130
2,449
610
597
—— Transaction focus in life sciences heavily weighted towards hematology – four of top five deals in this area.
—— In both sectors, US and China were the most active countries.
2,611
2,530
265
2013
2014
2015
222
2016
664
647
67
74
2017 Q1 2017 Q1 2018
Number of Announced Deals
Deal Value in $ bn.
Sources: Thomson One, KPMG Analysis
—— KPMG’s Deal Thermometer indicates that the environment for M&A activity will remain moderately strong in both life sciences and chemicals.
figure 2: Trends in chemicals m&a 1,114
1,133
1,117
986
215
1,151
1,127
233
104 54
2012
100
42
2013
2014
2015
2016
295
250
45
24
2017 Q1 2017 Q1 2018
Number of Announced Deals
Deal Value in $ bn.
Sources: Thomson One, KPMG Analysis
deal thermometer Q1 2018 KPMG’s Deal Thermometer signals the environment for M&A deals in chemicals and life sciences. It combines the appetite for deals (changes in forward P/E ratios) with the capacity to fund deals (changes in Net Debt/ EBITDA multiples). ‘Hot’ signifies an environment conducive to deal-making. HOT
lIFE sCIENCES Deal appetite (Forward P/E ratio)
16.2
Deal capacity (Net debt/EBITDA)
chemicals Deal appetite (Forward P/E ratio)
Deal capacity (Net debt/EBITDA)
MODERATE
16.0
14.8
1.0x
13.8
1.1x 0.8x
0.6x 1% 31 Mar 2017
7%
41% 31 Mar 2018
31 Mar 2018
Sources: Capital IQ, KPMG Analysis
31 Mar 2019
COOL
31 Mar 2017
24% 31 Mar 2018
31 Mar 2018
Sources: Capital IQ, KPMG Analysis
31 Mar 2019