Sales & Support: 1-800-921-2004 -

Mergers & Acquisitions

In-Play Exclusive Forum Bylaw Trends

In response to the epidemic of M&A strike suits (litigation brought for the purpose of obtaining a settlement), target companies that have not already amended their bylaws with exclusive forum provisions are taking action prior to announcing their deals. These bylaws require that certain disputes be litigated exclusively in specified courts. They intend to avoid the uncertainty and additional expense of litigating in multiple jurisdictions as a result of their M&A deals. Virginia incorporated, Kraft Foods Group is the latest M&A target company to adopt an exclusive forum bylaw. As of March 24, more target companies have adopted exclusive forum provisions in connection with their deals than in any other year since this new trend emerged in 2013. Delaware is the leading forum with 58% of target companies selecting it so far in 2015. M&A Fast Facts

U.S. Public M&A Deal Terms
March 2015 Last 12 Months
Ave. 1 Day Premium % 22.9% 28.2%
% of Mergers that are Accretive 38.1% 43.5%
Ave. Target Break Fee as % of Equity Value 3.7% 3.5%
Ave. Reverse Break Fee as % of Equity Value 5.4% 5.3%
% of Mergers that were hostile/unsolicited 9.5% 14.0%

Market Leaders - U.S. Public Mergers

David A. Katz of Wachtell, Lipton surpassed the $100 billion dollar mark advising on public mergers in 2014. Paul J. Shim of Cleary Gottlieb and Cary K. Hyden of Latham & Watkins rounded out the top three leading attorneys on public mergers.

Attorney Firm Equity Value $bil
David A. Katz Wachtell, Lipton, Rosen & Katz 114.0
Paul J. Shim Cleary Gottlieb Steen & Hamilton LLP 81.0
Cary K. Hyden Latham & Watkins LLP 72.5

M&A Adviser Fee Watch

Goldman, Sachs & Co. has maintained the top position in disclosed fees for deals announced in 2014. Morgan Stanley has moved in to second place among financial advisors in disclosed fees. JPMorgan rounded out the top three in disclosed fees. Disclosed fees reached their highest level since the financial crisis, soaring 63.7% over 2013.

High-Yield Bond News

SEC Registered High-Yield New Issue Volume increased in February

The pace of new issuance of SEC registered high-yield new issues rebounded in February with $4.71 billion pricing during the month up from $2.75 billion in January.

High-Yield Bond Covenants

Along with the increase in the level of high-yield bond issuance came a reduction in the level of covenant protection during February. Only one third of SEC registered deals had limitations on restricted payments covenants compared to 41% of new issues priced in the last twelve months. Limitations of indebtedness covenants were also present in only 33% of February's new issues compared to 47% of deals priced in the last twelve months.