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February 18, 2021 | M&A Reports 

Crosbie & Company Canadian Mergers & Acquisitions Report for Q4 2020

Deal Activity Bounces Back to Record High

In the fourth quarter of 2020, Canadian M&A activity increased significantly with 935 announced transactions, representing a new highwater mark for quarterly M&A activity. Despite a very weak second quarter, the annual number of transactions for 2020 was 3,136, slightly below the 3,227 transactions in 2019 but higher than many people anticipated given the impact of COVID-19.   

“We saw a surge in transaction announcements in Q4 as many transactions that were put on hold in the first half of the year due to the pandemic were revived and completed,” said Ian Macdonell, Managing Director at Crosbie & Company.  “It will be interesting to see how the next cohort of deals unfolds as we have a generally positive environment for M&A based partly on an expectation of a relatively rapid economic recovery despite recent delays in the rollout of COVID-19 vaccinations.” 

The aggregate deal value in Q4 of $84.5B was the second highest quarterly amount since 2016, surpassed only by Q4 2019 ($131.2B).  There were 16 mega-deals (transactions with values above $1B) in Q4 worth a combined aggregate value of $58.7B.  The largest mega-deal in the fourth quarter was the joint $13.6B acquisition of UK-based RSA Insurance Group plc by Intact Financial Corporation and Tryg A/S

The mid-market, which is defined as transactions involving companies with enterprise values below $250M, remained strong in Q4 with 351 transactions announced representing 88% of total deals with values disclosed and 11% of the aggregate value for such deals.

Financial sponsors were active in the fourth quarter of 2020 with 30 transactions (in excess of $100M) valued in aggregate at $44.9B. Twelve of the 16 mega-deals in the quarter involved financial sponsors including five transactions involving Brookfield related entities.

Cross border transactions continued to comprise a significant portion of M&A activity representing 44% of total activity and 69% of aggregate value. Consistent with most quarters, outbound activity (Canadian acquiror and foreign target) outpaced inbound activity, although by a comparatively lower factor of 1.3 times.  In 2020, Canadian buyers were highly acquisitive internationally, with 830 acquisitions of foreign companies during the year.  The United States continued to represent the largest market for Canadian companies that were looking to make acquisitions abroad.  In 2020, Canadian companies acquired 483 US-based companies, representing 58% of all foreign acquisitions made by Canadian firms

The increase in activity in Q4 was broadly based across industry sectors.  The Information Technology, Industrial and Real Estate sectors were the most active this quarter with 117 ($8.4B), 112 ($7.3B) and 104 ($12.8B) announced transactions respectively.  Activity in all three of these sectors were up significantly in the Q4 and were at or above pre-pandemic levels.  The Precious Metals and Metals & Mining sectors remained active with 88 and 89 announced transactions although the Precious Metals sector was down from the unusually high level of activity over last two quarters.  The Financial Services sector continues to remain active, partly due to the increased use of capital pool companies as a method for taking private companies public. 


  • Deal activity increased 16% to a new highwater mark in the fourth quarter of 2020 with 935 announced transactions, following a 34% increase in deal activity in Q3 
  • Aggregate deal value of $84.5B was the second largest aggregate amount since Q3 2016 and exceeded the combined aggregate deal value of the first 3 quarters of 2020 ($78.8B) 
  • Cross-border M&A activity remained strong in Q4 with 410 announced acquisitions, representing 44% of aggregate deal activity which is comparable to prior quarters
    • There were 144 acquisitions of Canadian companies by foreign acquirers despite pandemic travel restrictions


  • There were 16 mega-deals announced in the fourth quarter of 2020 with an aggregate value of $58.7B
    • This was the third largest aggregate dollar value in the last 4 years and was well above the combined value for the first three quarters of 2020 ($43.4B)
  • The largest announced transaction this quarter was the $13.6B joint acquisition of UK-based RSA Insurance Group plc (LSE:RSA) by Intact Financial Corporation (TSX:IFC) and Tryg A/S  

Industry Sector Activity

  • Information Technology, Industrials and Real Estate were the most active sectors this quarter with 117 ($8.4B), 112 ($7.3B) and 104 ($12.8B) transactions announced respectively
  • Precious Metals and Metals & Mining remained very active in the quarter although Precious Metals activity was down from unusually active levels in Q2 and Q3
  • Financial Services also remained active relative to historical levels as this includes capital pool company transactions 

Breakdown by Transaction Size

  • 88% of transaction activity in the quarter was from mid-market transactions below $250M (for transactions with disclosed values)
  • In this segment, there were 351 transactions valued at $9.5B or approximately 11% of total M&A value 
  • Q4 mega-deal activity (deals over $1B) was strong with 16 announced deals valued at $58.7B exceeding the combined value of the prior three quarters ($43.4B)

Canadian Domiciled versus Foreign M&A Targets

  • There were 638 acquisitions of Canadian domiciled companies in Q4, a 20% increase relative to Q3 2020
  • Aggregate deal value for these Canadian domiciled targets increased to $33.8B from $8.2B in Q3 2020
  • 297 transactions this quarter (32% of the total) were for companies domiciled outside of Canada
  • Canadian companies made 688 acquisitions in the fourth quarter including 458 domestic deals

Cross-Border Deals

  • Cross-border deals represented 44% of total activity and 69% of total deal value
  • Outbound cross-border activity increased 4% and inbound cross-border activity increased by 25% compared to the prior quarter
  • As a percentage of total cross-border activity, Canada/US transactions represented 57% of cross-border activity and 49% of cross-border deal value 

Deals by Provincial Domicile

  • Ontario remains the most active province this quarter with 247 announced deals valued at $21.4B
  • British Columbia was also active this quarter with 158 deals valued at $1.3B
  • Newfoundland had the second largest aggregate deal value of $3.6B, primarily due to the Verafin Inc. mega-deal

Crosbie & Company Inc.
150 King Street West, 15th Floor, P.O. Box 95, Toronto, Ontario M5H 1J9
Tel: 416.362.7726 | Toll Free: 1-866-873-7002 | Fax: 416.362.3447


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