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August 23, 2019 | M&A Reports 

Crosbie & Company Canadian Mergers & Acquisitions Report for Q2 2019

Canadian Acquirers Send M&A Activity to New High 

M&A activity set a new record high in the second quarter with 886 announced transactions valued at $70.5B. Following a slight decline in Q1 2019, deal activity rebounded 11% in Q2 as the Canadian M&A market continued its robust activity levels. The number of transactions per quarter has now exceeded 800 for 6 consecutive quarters.  Total transaction value for the second quarter was down modestly from $74.8B in the prior quarter but remained well above the quarterly average seen over the last two years.

“Canadian companies were highly acquisitive this quarter after a brief spending pause in Q1,” said Ian Macdonell, Managing Director at Crosbie & Company. In the second quarter Canadian companies made 693 acquisitions (up 11% from 627 acquisitions in Q1 2019), setting a new record for Canadian-made acquisitions in a single quarter.  “We continue to experience an environment where Canadian companies are taking advantage of strong balance sheets and ready access to capital to accelerate growth and increase market share through acquisitions, both domestically and abroad,” said Macdonell.  “Combine that with an aging population of business owners capitalizing on a ‘Seller’s Market’, and you have the ingredients for record levels of M&A activity.”

There were 13 mega-deals announced this quarter with a combined aggregate value of $42.6B. The largest transaction was the $7.7B acquisition of UK based Merlin Entertainments by a consortium of investors that included the Canadian Pension Plan Investment Board. CPPIB was also involved in the second largest transaction valued at $6.6B, which involved selling its stake in Advanced Disposal Services to Waste Management Inc. Another noteworthy mega-deal was the $5B announced acquisition of WestJet Airlines by Onex Corporation.

Financial sponsors were active in the second quarter of 2019 with 19 transactions (in excess of $100M) valued in aggregate at $36.2B.  Six of the 13 mega-deals in the quarter, including the four largest, involved financial sponsors including several Canadian pension funds that continue to pursue large transactions, both domestically and abroad.

The mid-market has traditionally been the engine for Canadian M&A transaction activity and it again drove deal volumes in Q2. During the second quarter, Canadian mid-market activity dominated the M&A landscape. The mid-market, which is defined as transactions with enterprise values below $250M, represented 88% of total deal activity and 13% of aggregate value. 

The Industrials sector was the most active this quarter with 113 announced deals and also led the way in terms of value with a total transaction value of $17.3B. The second most active sector this quarter was Real Estate with 110 transactions accounting for $12.5B in transaction value.  The Healthcare sector was also active with 99 transactions totalling $3.5B in transaction value with the increase in activity largely driven by Cannabis transactions.


  • Deal activity surpassed the previous high-water mark with 886 announced transactions
  • Q2 announcements increased 7% relative to the same quarter in 2018
  • Sixth consecutive quarter with 800+ announced transactions, and an 860-deal average during the last 4 quarters
  • Total deal value in Q2 was $70.5B, down 4% relative to Q2 2018, but remains above the quarterly average over the last two years
  • Cross-border activity remained steady in Q2, representing 43% of deal activity 
    • Canada/US cross-border transactions comprised 62% of all cross-border deals, with Canadian acquirers outnumbering US acquisitions by a ratio of 2:1


  • 13 mega-deals is in line with the previous quarter, however 5 fewer than Q2 of the previous year
  • Represented $42.6B of total value, which is below the announced values seen in Q1 2019 and Q2 of 2018
  • Largest announced transaction was the $7.7B purchase of Merlin Entertainments by a consortium of investors including CPPIB
  • Canadian buyers were involved in 9 of the 13 mega-deals including 5 cross-border acquisitions

Industry Sector Activity

  • The Industrials sector was the most active this quarter and deal activity increased 27% relative to the same quarter in 2018, with 113 transactions valued at $17.3B
  • Real Estate remained active this quarter with 110 transactions and an aggregate value of $12.5B 
  • Healthcare saw a strong 38% increase in activity relative to the same quarter in 2018, largely driven by increased Cannabis transactions

Breakdown by Transaction Size

  • 88% of transaction activity in the quarter was from mid-market transactions below $250M (for transactions with disclosed values)
  • Mid-market transactions were valued at $9.1B or approximately 13% of total M&A value

Domestic Versus Foreign M&A

  • Domestic M&A activity remained robust in Q2, with 573 announced transactions, the 2nd highest amount in the last 5 years
  • The aggregate value of acquired Canadian companies was $34.2B in the second quarter
  • Canadian companies acquired 250 foreign targets in the second quarter, exceeding the four-year quarterly average by 25% 

Cross-Border Deals

  • The cross-border outbound to inbound M&A activity ratio remained near the historical trend of 2:1 this quarter
  • Cross-border deals represented 43% of total activity and 58% of total deal value
  • The United States remains Canada’s most active M&A partner, representing 62% of cross-border activity

Target by Province

  • Ontario remains the most active province this quarter with 236 deals valued at $11.1B
  • British Columbia was also active in the second quarter with 120 deals valued at $3.5B
  • Deal value in Nova Scotia spiked this quarter as India based Sakthi Global Holdings put forth a $1.6B unsolicited bid to acquire Halifax based DHX Media

Crosbie & Company Inc.
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