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Guernsey M&A activity rises in Q3, says Appleby

19 November 2014

Statistics from Appleby show that Guernsey bucked the general offshore trend and experienced substantial increases in both deal value and volume when compared with the previous quarter.  

A report released today by Appleby showed that despite a dip in the value and volume of offshore deals in the third quarter of 2014, the year as a whole is on track to be among the best showings for offshore M&A in the past decade.

The figures show that Guernsey was home to 64 deals with a total value of US$1.82 billion in the third quarter of the year. This represented a 28% increase in the number of deals and 43% jump in deal value when compared to the second quarter of the year.

"The Crown Dependencies of Guernsey, Jersey and the Isle of Man have all seen a rise in deal volume as compared to the second quarter of 2014, up 28%, 11% and 59%, respectively," said Jeremy Berchem, Corporate and Commercial Group Partner in Guernsey.

"Guernsey was also among the jurisdictions that saw the most positive growth in deal value when compared to the previous quarter."  

The latest edition of Offshore-i, an Appleby report that provides data and insight on merger and acquisition activity in the major offshore financial centres, focuses on transactions announced during the third quarter of 2014.

According to the report, the third quarter of the year experienced a 46% drop in total value of offshore deals when compared to the exceptional previous quarter. Appleby noted, however, that historically the Q3 2014 numbers are strong with deal value up 25% over the same quarter in 2013.

"Overall, the year 2014 is set up to be a peak year for value of deals conducted in our offshore markets," said Cameron Adderley, Partner and Global Head of Corporate & Commercial.

"The first three quarters of the year have a combined total deal value north of US$200 billion, which has only been exceeded in two years over the last decade. This year should surpass even those two annual totals when the Q4 numbers are included."

In the third quarter of 2014, 626 deals were announced involving offshore targets, which in combination were worth US$48.1billion.  Following the 677 recorded deals in Q2 2014, the quarter maintains an impressive run of 600-plus deals per quarter that began in 2013, the report found.

In addition, the average deal in the third quarter of 2014 was worth US$77 million, making it the fifth most prosperous quarter for average deal size since the start of 2010, a period of almost 20 quarters. For the first three quarters of 2014, Appleby said an average of US$102 million has been spent on each transaction. Only the boom year of 2007 has come close to that level, when the average was US$100 million.

The third quarter boasts nine transactions worth in excess of US$1 billion, and two that exceed US$2 billion. Appleby also noted that deals worth less than US$100 million made up a significant proportion of the quarter's spending, marking a welcome return of activity in the lower end of the value chain.

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