MarketLine Blog

Posts about Merger & Acquisition

LiDAR self-driving technology. A case of calculated theft?

MarketLine

Google and Uber started off as friends with Google parent Alphabet investing $258m in Uber in 2013. They then became competitors, as Uber started experimenting with its fleet of self-driving cars in 2016. Finally, in 2017, both companies ended as adversaries in court, engaging in a bitter legal fight to control the future of transportation. The suit details the lengths Waymo goes to in order to protect its trade secrets, including purchasing LiDAR components from numerous vendors and completing assembly in-house to prevent any single vendor from knowing everything about… Read more

From GM to PSA: Why the sale of Vauxhall Opel is good for shareholders but bad for workers

MarketLine

US-based General Motors is the world’s third largest automobile manufacturer by sales, and second largest by revenues. French-owned Groupe PSA, which sold nearly 3.2 million vehicles and had revenues of €54bn ($57bn), is a fairly small player in comparison. GM’s ownership and continued management of Vauxhall Opel is at odds with the rest of its portfolio – the company primarily operates in the US and Asia, selling brands including Chevrolet, Buick, Holden and Wuling – while PSA operate Peugeot, Citroen and DS Automobiles primarily out of Europe. The sale of… Read more

Tesco-Booker: The Squeeze on Small Businesses

MarketLine

Tesco, one of the largest retailers in the world, is the most dominant supermarket in the UK market. Its recent announcement to merge with Booker was a surprise to all. Booker occupies a very different area of the market, primarily offering bulk-purchase supply to small retailers, both independent and franchised stores under brands it owns, such as Londis and Budgens. At first glance then, this seems an odd target for Tesco; to merge operations with a company whose target market is so different to its own. Indeed, no one considers… Read more

Verizon purchase of Yahoo: Data breach puts deal at risk, but purchase still likely

MarketLine

The theft of confidential information from Yahoo in 2013, although only recently announced, has heaped doubt over the proposed purchase of Yahoo by Verizon. Many predict the final bill will be substantial and worse could follow – the FBI are investigating and could yet cause more problems. A reduced share price caused Verizon to reappraise the sale. For both parties the realization that damage occurring from the data theft has yet to be fully felt is a serious problem, making revaluing Yahoo much harder. Regardless of which route Verizon chooses… Read more

AT&T to buy Time Warner

MarketLine

When business acquisitions on this scale are announced they almost inevitably become political – hence extensive investment in political lobbying. Announcing a buyout, therefore, just weeks before one of the most acrimonious presidential races in living memory concludes gives a difficult birth. Both candidates have already declared their displeasure. Some Senators have also voiced concerns and their intent to heavily scrutinize any proposals that come before them. Exactly why this time should be chosen is unclear: it makes the deal far more politicized than need be the case, raising uncertainties… Read more

Microsoft: $26.2bn LinkedIn acquisition its largest to date, but deal makes sense

MarketLine

Surrounding this acquisition purchase came many queries questioning the future success of such a transaction. With an alarming price tag attached to the bill, Microsoft acquiring LinkedIn is by far the largest purchase it has made in history. With a pretty poor track record in large acquisitions, (with the exception of Skype of course), it remains to be seen if this one is any different. CEO Satya Nadella has been leading Microsoft since early 2014 and feels it is his job to turn the poor history of buyouts into a… Read more

Williams & Glyn: RBS abandons spin-off IPO plan

MarketLine

To comply with European Commission State Aid requirements, RBS agreed in 2009 to a series of restructuring measures that were to be implemented over a four year period. One of these measures was the divestment of the RBS branch network in England and Wales and the NatWest branches in Scotland. This was scheduled to be completed by 2013, but an extension was granted after the original bidder, Santander, pulled out. A consortium known as Corsair stepped into the breach and invested, facilitating a later sale or, more likely, an IPO…. Read more

Activision Blizzard to seize mobile gaming crown?

MarketLine

US video game publisher Activision Blizzard Inc. has announced a deal to buy mobile game producer King Digital Entertainment Plc (creator of Candy Crush Saga) in a deal worth a reported $5.9bn, over $1bn less than King Digital’s valuation at its 2014 IPO. Activision Blizzard, publisher of global franchises such Call of Duty and World of Warcraft, will pay $18.00 for each of King Digital’s outstanding shares – a 20% premium on the closing share price on 30th October 2015, but still a knockdown price on King Digital’s $22.50 IPO… Read more

Sabadell’s TSB takeover sparks wave of optimism

MarketLine

On Friday (March 20), Spanish banking group Banco Sabadell announced that it had reached an agreement to acquire UK high street bank TSB, sparking talk of a potential wave of M&A activity. The cash offer of 340p ($5.60) per share represents a premium of 30% on the June 2014 flotation price of 260p ($4.28) and a slight premium on the current share price of 333p ($5.48). The advantages for all parties are clear. For its part, Banco Sabadell is prepared to pay a premium for what it sees as growth… Read more

California Love undone? Apple delays purchase of Dr.Dre’s Beats Electronics

MarketLine

Apple’s Infinite Loop offices in Cupertino appear to be getting cold feet about their embrace of Santa Monica based Beats Electronics in this perplexing California focused buy-out potentially worth $3.2bn. On the face of it, this has always looked like an odd choice of acquisition. Apple is not really in need of extra revenues, which have moved from $108bn in 2011 to $171bn in 2013. Beats Electronics makes headphones, earphones and speakers, as well as running the Beats Audio software technology and the Beats Music streaming service. Given the vast… Read more

Apple’s imminent questionable $3.2 billion acquisition

MarketLine

Tech giant, Apple, has recently been rumored to be acquiring American audio company Beats Electronics in a deal worth $3.2 billion in the very near future. Beats Electronics revenues have relied heavily on its sales of Dre Beats audio equipment, though Apple’s acquisition is speculated to be focused more-so on Beats Electronics’ catalog music streaming service Beats Music, launched in January 2014. Apple have failed to make as big of a mark as they would wish to on the digital streaming market thus far, even though iTunes Radio is said… Read more

Facebook is latest tech Titan to buy into robotics

MarketLine

Facebook’s rumoured acquisition of UAV manufacturer Titan Aerospace is the latest in a series of deals which have seen companies such as Amazon and Google make moves into the robotics and AI sector. Facebook’s $60m purchase comes after Amazon bought Kiva Systems for almost $800m in 2012 and announced plans to develop ‘Prime Air’ a drone-delivery service. Meanwhile, Google’s acquisition of Boston Dynamics was just one of the eight robotics companies the technology giant bought in 2013. Facebook will reportedly use Titan’s solar powered UAVs as atmospheric satellites to provide… Read more

Does BlackBerry have a future in smartphones?

MarketLine

It is a worrying time for Canadian smartphone manufacturer Blackberry Ltd. (BlackBerry) at a time when its largest rivals seem to be going from strength to strength. Apple Inc. (Apple) has seen huge consumer enthusiasm for its latest flagship, the iPhone 5S, with demand far outstripping supply at launch. Additionally, manufacturers offering products on Google Inc.’s (Google) Android operating system, such as Samsung Electronics Co., Ltd. (Samsung) have enjoyed significant sales figures over the past few months. The news that BlackBerry has had to cut 4,500 jobs (40% of its… Read more

Glencore Xstrata: Commodity Prices and Merger aftershocks

MarketLine

When Glencore and Xstrata merged, it created the fourth largest mining company globally and an integral part of many commodities’ supply chains. It looks now however that Xstrata was overvalued and the company could be facing an $8bn loss on mining assets due to weaker conditions in the commodity industry. Following the 16-month acquisition saga, in the company’s first set of results saw a 2% dip in revenue for the first of 2013 compared to last year, and a 9% drop in EBITDA. Two significant macroeconomic events have contributed to… Read more