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Mergers & Acquisitions

U.S. Public M&A – 2016 Year in Review

U.S. public M&A activity remained vibrant in 2016 following the record-breaking deal announcements of 2015. Investment bankers and corporate attorneys set a record for closing U.S. public target deals in 2016 with $697.1 billion in deals closed during the year. Goldman, Sachs & Co. and Skadden, Arps topped the Deal Point Data M&A league tables for completed deals in this key market, closing $346.3 billion and $243.5 billion respectively. New deal announcements totaled a healthy $845 billion in 2016. This represents a 24.4% decline in dollar volume compared to the record-setting volume of 2015. 2017 is poised to be another busy year for top-tier investment banks and law firms as over $640 billion in U.S. public deal volume was pending as of December 31, 2016.

2016 Industry Sector Leaders U.S. Public M&A
Industry Sector Top Ranked Law Firm Equity Value ($bil)
Technology Wilson Sonsini Goodrich & Rosati 50.1
Consumer Goods Wachtell, Lipton, Rosen & Katz 82.6
Industrial Skadden, Arps, Slate, Meagher & Flom 8.9
Consumer Services Cravath, Swaine & Moore 87.2
Energy Sullivan & Cromwell 42.5

Market Leaders - U.S. Public Mergers

Wachtell, Lipton, Rosen & Katz was the top ranked legal adviser on U.S. public M&A deals announced in 2016. Sullivan & Cromwell ranked second in the high profile public M&A advisory market.

Rank Firm Equity Value ($bil)
1 Wachtell, Lipton, Rosen & Katz 239.2
2 Sullivan & Cromwell 206.4
3 Cravath, Swaine & Moore 139.8

M&A Adviser Fee Watch

2016 M&A advisory fees of $4.2 billion have been disclosed through February 4 down by 13.8% over full year 2015. Goldman, Sachs & Co. led the market with $755 mil in fees already disclosed. Morgan Stanley took second place among financial advisors in disclosed fees. JPMorgan rounded out the top three in disclosed fees.

High-Yield Bond News

New Issue Volume

The pace of issuance of SEC registered high-yield new issues rose by 3.6% from 2015's level. This represents a 24.1% decline over the pace of new issuance in 2014.

High-Yield Bond Covenants

Once again, the level of covenant protection continued to decrease in 2016. We evaluated the covenants in SEC registered new issues and found that only 29% contained limitation on restricted payments provisions down from 36% in 2015 and 42% for deals priced in 2014. Limitations of indebtedness covenants were also present in only 38% of new issues compared to 39% in 2015 and 47% of 2014's deals.