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Mergers & Acquisitions

U.S. Public Deal Activity Stays Steady

The pace of U.S. public M&A activity retracted slightly in July from $143.4 billion in June to a solid $124 billion, according to research by DealPointData. The price for control increased in July. The average 90 day control premium increased to 33.3% from 31.14% and marked the fourth consecutive month above 30 per cent. For the month of July, Morgan Stanley was at the top of the U.S. public financial adviser's league table, with $53.5 billion in deals. Among legal advisers, Davis Polk was the market leader with $39.8 billion in deals announced in July.

U.S. Public M&A Deal Terms
July 2015 Last 12 Months
Avg. 1 Day Premium % 32.0% 28.5%
% of Mergers that are Accretive 31.3% 40.2%
Avg. Target Break Fee as % of Equity Value 3.5% 3.6%
Avg. Reverse Break Fee as % of Equity Value 6.3% 5.8%
% of Mergers that were hostile/unsolicited 6.3% 13.7%

Market Leaders - U.S. Public Mergers

Morgan Stanley was the top financial adviser on U.S. Public M&A deals announced in July 2015.

Rank Firm Equity Value $bil
1 Morgan Stanley 53,530
2 Goldman Sachs 50,846
3 Citi 43,766

M&A Adviser Fee Watch

Through the end of July, Goldman Sachs claimed the lead with $351 million in fees already disclosed. Centerview Partners held on to second place among financial advisors in disclosed fees. Morgan Stanley rounded out the top three in disclosed fees.

High-Yield Bond News

SEC Registered High-Yield New Issue Volume decreased in July

The pace of issuance of SEC registered high-yield new issues decreased 38.1% in the July with $1.75 billion pricing during the month down from $2.82 billion in June.

High-Yield Bond Covenants

The level of covenant protection also decreased in deals issued during the month. In July, 52% of high-yield deals had limitations on restricted payments covenants compared to 71% of new issues priced in the last twelve months. Limitations of indebtedness covenants were also present in only 38% of July's new issues compared to 76% of deals priced in the last twelve months.