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August 20, 2021 | M&A Reports 

Crosbie & Company Canadian Mergers & Acquisitions Report for Q2 2021

Near Record Quarter Contributes to the Strongest First Half Ever

Following a blistering start to the year and an all-time record Q1, Canadian M&A announcements in second quarter of 2021 essentially maintained this pace with only a slight 2% decrease.  The 990 Canadian M&A transactions announced in Q2 2021 represents the second highest quarter on record and contributed to the strongest first half we have seen since Crosbie began tracking M&A data.  Total transaction value the first half was $175B across approximately 2,000 transactions – which is a testament to conditions that are highly constructive to M&A activity.          

“We don’t read anything into the slight decline.  There was likely some catching up that occurred in some of the prior quarters but we know from our own practice and everything we hear that there is a tremendous amount of front-end activity out there.  This should drive announcements for the next few quarters,” said Colin Walker, Managing Director at Crosbie & Company.  “We fully expect the trend to continue given the multiple tailwinds for M&A – both public and private.”      

The aggregate deal value in Q2 2021 of $93B exceeded the $81.6B in Q1 and remains well ahead of pre-pandemic quarterly totals.  There were 13 mega-deals (transactions with values above $1B) in Q2 worth a combined aggregate value of $69.7B.  The largest transaction announced in the quarter was Canadian National Railway’s superior counteroffer to acquire Kansas City Southern for $41.1B, outbidding rival Canadian Pacific.  

Although domestic M&A activity (648 announcements) was very strong in the quarter, what might be surprising is the strength of cross-border M&A in the context of what has effectively been an 18-month border closure between the United States and Canada.  Cross-border activity kept pace with overall market activity reaching another new high of 458 transactions, representing 46% of total activity.  Moreover, 295 of these transactions were acquisitions abroad by Canadian companies - representing almost 30% of the announced deals in Q2.  From a value perspective, cross-border deals rebounded to 68% of total value in Q2 compared to 24% in Q1 2021 which is partly a reflection of several very large domestic transactions during Q1.  Canada/US transactions again accounted for the majority of cross-border deals representing 57% and 81% of total cross-border activity and deal value, respectively.    

The mid-market (transactions with values below $250M) also remained very active in Q2.  With 415 announcements, this market segment represented 92% of announcements where transaction values were disclosed, and 12% of aggregate value for such deals, a lower percentage than the historical average reflecting the large amount of mega-deal activity this quarter.

The ‘tech boom’ continues as the Information Technology sector was once again the most active sector this quarter with 141 announced transactions valued at $3.3B.  The strength in commodities was reflected in 126 Metals and Mining transactions although at a modest total value of $1.8B, largely comprised of smaller transactions after excluding the $1.3B Algoma transaction. For the second quarter in a row, Real Estate rounded out the top three most active sectors with 108 transactions announced and total deal value of almost $10B. Lastly, Energy related deals continued to increase for the fourth consecutive quarter as commodity prices continue to remain strong. 


  • Deal activity in the second quarter of 2021 remained strong with 990 announced transactions, increasing by 65% year-over-over, but declining 2% from all time highs achieved in Q1 2021 
  • Deal value of $93B in Q2 2021 was at the highest level in 6 quarters and was well above the lows observed during the second and third quarter of 2020 
  • Despite a closed border, cross-border M&A activity remained strong, with 458 announced acquisitions, representing 68% of aggregate deal activity, above that of previous quarters
    • Canadian companies acquired 262 companies abroad in Q2, representing over a quarter of total activity during the period


  • There were 13 mega-deals (those over $1B) announced in the second quarter of 2021 with an aggregate value of $93B 
    • This was ahead of the last two quarters and represents the largest quarter for mega-deal value since the onset of the COVID-19 pandemic
  • The largest announced transaction this quarter came as the result of a hotly contested bidding war, notably Canadian National’s superior counteroffer for Kansas City Southern at a price of $41.1B 

Industry Sector Activity

  • The strength of M&A activity during the quarter was widespread across the industry spectrum, with activity increasing in most industry categories except for Precious Metals and Financial Services that saw some retreat
  • Information Technology, Metals and Mining and Real Estate were the most active sectors this quarter with 141 ($3.3B), 125 ($446M) and 108 ($9.9B) transactions announced, respectively
  • Energy continues to increase for the fourth quarter in a row backed by higher commodity prices and Real Estate has increased transaction values to almost $10B in Q2 2021  

Breakdown by Transaction Size

  • For transactions with disclosed values, 92% of activity in the quarter represented mid-market transactions (values below $250M) 
  • Q1 mega-deal activity (deals over $1B) continued to be strong with 13 announced deals valued at $69.7B
  • At $41.1B, the CN/KC Southern transaction anchored the mega-deals table this quarter

Canadian Domiciled versus Foreign M&A Targets

  • Canadian companies made 780 acquisitions in the second quarter including 485 domestic deals, down 3% from 489 acquisitions in Q1 2021
  • There were 648 acquisitions of Canadian domiciled companies in Q2, a 5% decrease relative to Q1 2021
  • Aggregate deal value for these Canadian domiciled targets decreased to $33.9B from $50.1B in Q1 of 2021

Cross-Border Deals

  • Cross-border deals represented 46% of total activity and 68% of total deal value
  • Outbound cross-border activity increased 18% and inbound cross-border activity decreased by 12% compared to Q1 2021
  • Canada/US transactions represented 57% of cross-border activity and 81% of deal value

Deals by Provincial Domicile

  • Ontario remains the most active province this quarter with 233 announced deals valued at $8.17B
  • British Columbia was also active this quarter with 178 deals valued at $2.08B
  • Alberta had the largest aggregate deal value of $20.4B, primarily due to the
    Inter Pipeline

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