NEW YORK-Merger and acquisition activity involving American companies shed some of its recent hyperactivity, slowing down last quarter to its lowest level since early 1998, Mergerstat L.P., Los Angeles, reported.
Among companies releasing the dollar amount of their transactions, aggregate deal value dropped to $248.1 billion, compared with $470.9 billion during the first quarter of this year. During the second quarter of 1999, total M&A activity was $399.6 billion.
Gone too this past quarter was the bevy of mega-mergers that individually topped the billion-dollar mark. The second quarter recorded 44 such transactions, down from 63 in the first quarter and 57 during the second quarter of 1999.
The telecommunications blockbusters of the latest complete quarter included a $10.7 billion agreement by the Terra Networks Group of Spain’s Telefonica SA to acquire Lycos Inc., thereby creating “the first truly global Internet portal,” Mergerstat said.
The four other super-sized telecommunications mergers of the latest quarter comprised: the $5.43 billion offer by Cisco Systems Inc. for Arrowpoint Communications Inc., which provides switches to optimize Web content delivery; the $4.4 billion agreement for Nippon Telegraph and Telephone Corp. of Japan to buy Verio Inc. in order to become a worldwide Internet protocol services provider; the $2.88 billion bid by Sycamore Networks Inc. to purchase Sirocco Systems Inc., which develops and markets various network management products; the $1.54 billion offer by QLogic Corp. to purchase Ancor Communications Inc., another network equipment maker.
In all industry sectors, the number of announced mergers and acquisitions totaled 613, down from the record-setting number of 726 announced during the first quarter of this year. However, the latest complete quarter is well ahead of the year-ago period, during which 450 deals were announced.
Transactions in the wireless and wireline communications sector totaled 118 last quarter, down from the 141 posted during the first quarter of this year.
Among transactions whose values were disclosed, Sensar Corp.’s $744 million bid to buy Net2Wireless Corp., a wireless communications technology developer, was the largest deal announced last quarter in this business segment.
Mergerstat tracks mergers and acquisitions involving U.S. business entities, excluding the exchange of business assets, private placements, spinoffs and open-market transactions. Further information may be obtained on the company’s Web site at www.mergerstat.com.
