When looking for quantitative data on mergers and acquisition, the various databases available each offer a different set of search filters. Most of these are very similar, such as annoucement date or country of target company, but the type or attributes of the deal vary the most.
The attached table compares Thomson ONE.com, Capital IQ and Bloomberg Professional, and lists the deal type or attributes for each. The options are sorted into alphabetical order and spaced out accordingly to make the comparisons easier.
Why do this? Perhaps you are looking to filter on a specific type of deal that can only be identified in one of these database tools.
Go to: Screening & Analysis > Deals & League Tables > M&A > Advanced Search, then consider the two filters:
- Deal Info > Deal Type (Code)
- Deal Info > Acquisition Techniques (Code)
Go to: Screening > Transactions, then consider the two filters:
- General Transaction Details > Types
- M&A Details > Features
Go to: MA <GO>, then consider the two filters:
- Deal Criteria > Deal Types
- Deal Type > Deal Attributes
Finally, download M&A Compare Filters [Excel format] to find out in advance if the specific kind of deal that you are looking for can be filtered out in the database of your choice.
A merger or acquisition is a combination of two companies where one corporation is completely absorbed by another corporation. The lesser company loses its identity and becomes part of the larger corporation, which retains its identity and assumes all the rights, privileges, and liabilities of the merged company.
The research of mergers and acquisitions forms a key part of the MBA programme and a greater understanding of the issues involved is also of interest to the wider research community. The proposed merger between pharmaceutical companies Pfizer and AstraZeneca is much reported in the business news from a variety of perspectives: jobs, innovation, research and development, takeover policy, and tax policy.
Bloomberg Professional is great for researching mergers involving public (quoted) companies. The MA (Merger and Acquisition) function gives an overview of the M&A market and the ability to drill down to details of specific deals. In addition Bloomberg is excellent for researching companies and business news.
You will see that Bloomberg uses colour coding to highlight whether a deal is proposed, pending, completed or withdrawn. You can use the actions option to refine your deal list to select a specific country or industry, or select an individual deal to access the details.
Thomson ONE.com also offers a range of M&A information:
- Market Views – Deal Activity – M&A Market Overview gives a summary of the number and value of deals
- Screening & Analysis – Deals & League Tables – M&A – gives various options for searching the deals module
- Selecting a company and then Company Views – Deals gives the recent deals for a specific company
For qualitative reports on mergers and acquisitions, both proposed and completed, investigate the analyst reports from Thomson ONE.com or the older Thomson Research. With leading contributors such as Merrill Lynch, Credit Suisse and Morgan Stanley, Thomson ONE.com provides analysis reports for over 60,000 companies. It affords authoritative insights into sales, forecasts and strategy evaluation.
Market research databases, for example Keynote/Mintel/Passport GMID, provide information on business market trends that influence companies M&A strategies. These databases allow for the study of market size, segmentation, trends, forecasts and competitor and buying behaviour. They focus on the market analysis of UK and International Industrial/Consumer markets.
Business news is often an essential part of M&A research. If you are not using Bloomberg then Factiva (from Dow Jones) is a key source. Covering over 10,000 international, national and regional newspapers, news feeds and trade publications, Factiva provides access to the latest targeted company and sector developments. Searches can be made via company name, publication, industry, region or type of news.
For quantitative data to study trends and features of historic mergers and acquisitions you will want to get your candidate deal list from Bloomberg Professional MA function search, or a search in Thomson ONE.com screening and analysis, or a search in SDC Platinum. SDC Platinum is an older product from Thomson Reuters but still widely used because of its reputation among commercial and academic customers.
It was recently reported that GlaxoSmithKline (GSK) have sold the Lucozade and Ribena drinks brands to Japanese firm Suntory for £1.35bn.
GSK chose to get rid of the well-known UK brands after deciding to focus on its core pharmaceuticals business.
from Lucozade and Ribena sold to Suntory for £1.35bn (BBC Business News, 9 September 2013).
For background information on the soft drinks market.
Soft Drinks (Carbonated and Concentrated) Market Update 2012 (19th Edition October 2012, Edited by Leah Tutt)
Note. All KeyNote market research reports are for the UK market.
Passport (formerly GMID) from Euromonitor has a number of report (see screenshot below) including
GlaxoSmithLinke Plc in Soft Drinks (United Kingdom), Local Company Profile 14 Jun 2013
Purchase of Lucozade Takes Suntory Holdings a Step Closer to Becoming A Truly Global Company, CAMI Article 09 Sep 2013
I choose “Ribena” for my searches – as a child I was a big fan
For more information on the deal between GSK and Suntory – search:
There is also a video archive of all the past topics you can choose from. These include:
- 5 Common Pitfalls to Avoid in Screening
- Assessing Counterparty Credit Risk
- Corporate Valuations Series
- New Portfolio Templates
- Value Investing Using S&P Capital IQ
- Excel Trilogy: Basic/Intermediate/Advanced
You will need to have Java installed, and to allow it to run, and to accept the warning messages.
It should work on Windows and Mac OS in any modern web browser, but please leave a comment below if you find otherwise.
Please enter your University email address and your name when accessing these resources. Remember we only have an extended trial subscription for Capital IQ here at The University of Manchester Library so only one person can use it at a time.
The most recent webinar was titled “5 Common Pitfalls to Avoid in Screening” and we shall look at the first example from it.
Linking criteria and identifying a company as public on a given date in history
In this example we want to screen for a list of public materials companies that closed an M&A deal in the last 12 months with total revenue greater than US$1,000,000,000 one day prior to the closure of the deal.
- Begin by choosing the Screening tab in the menu bar and clicking on Companies.
- The first criteria must return no more than 1,000,000 results. From the first column, choose Company Details > Industry Classifications and click on Materials, then Add Criteria.
- From the last column, choose M&A Details > Dates then in the list choose Closed Date, with the Time Frame: Last 12 Months. This metric refers to a transaction, not to a company, but we can still use it for screening. Click Add Criteria.
- We now want to identify the company as a public company. It might be tempting to go for Company Details > Company Type: Public Company, but that would apply to the status today, not on the date of the transaction. To get the status on the date of the transaction, you need a metric relating to the Transaction (about the target company).So again from the last column, choose M&A Details > Valuations and in the list choose Pre-Deal Share Performance with the Data Point: Target Market Cap 1-Day Prior and the Value: Greater Than 0. This means the company was publicly listed. Ensure that Target/Issuer is displayed in the box below, and choose Type: AND from the radio buttons at the bottom. Click Add Criteria.Why Type: AND instead of Type: New (the default)? Because this criteria is part of a Transaction detail, and we are in Company Screening, we need to combine all the Transactions criteria together, using logical AND. It is a bit confusing, as all the criteria are combined with AND rather than OR, but it is essential when linking these types of screenings.
- Finally, to limit to target companies with Total Revenue greater than $1 billion at the time of the deal and not at the present day, choose from the last column M&A Details > Valuations then from the list Target/Issuer LTM Financials (at Announcement) with the Data Point: Total Revenue, Value: Greater Than 1000 (the units are millions of US Dollars). Again, ensure Target/Issuer is displayed below this and choose Type: AND to link it to the Transaction criteria. Click Add Criteria, then View Results.
The most important thing to take away from this is to consider using Pre-Deal Share Performance with the Data Point: Target Market Cap 1-Day Prior and the Value: Greater Than 0 to identify a company as public from a transaction, using the Type: AND operator after choosing a deal date.
There were two stories on the BBC Business News recently that provided a reminder of how deals generate news because they result from companies’ strategic decisions.
This news story covers a company going from Public to Private, and therefore delisting from a stock exchange, the reverse of an IPO (Initial Public Offering).
This illustrates why databases like Thomson One Banker and Bloomberg Professional track deals from when they are rumoured or announced (not just when they become effective). In Dell’s case there has been significant news coverage about the company’s strategic options now that PCs are seen to be in decline.
[Update June 2014 – Thomson ONE.com is (or T1.com) is Thomson Reuters replacement product for Thomson One Banker.]
This news story covers an acquisition. The surprise for me was that this is one US company taking over another. Although when I checked on Bloomberg Professional Virgin Media has 100% of its turnover in the UK, it has chosen to be a US company Virgin Media Inc, listed on the NASDAQ exchange.
Using the FAME database of UK companies you can check that Virgin Media Limited (registered no 02591237) is a subsidiary of Virgin Media Inc.
Bloomberg‘s Mergers & Acquistions (MA) function highlights the current largest deals – on 20 Feb 2013 these are HJ Heinz Co, Virgin Media Inc, and Dell Inc. Bloomberg Industries (BI) can be used to investigate industry trends including the expected impact of large deals, e.g. BI CATVE (Cable and Satellite Europe) has the Feb 05 news item “Liberty Fortifying in Europe May Boost Broadband, TV Competition” and a range of related industry data.
On 20 Nov 2012 Hewlett Packard (HP) announced that it was taking a write off of $8.8 billion of the $11.1 billion that it paid to acquire Autonomy in October 2010. At the time Automony was a member of the FTSE 100 and seen as a UK technology success story.
There has been lots in the UK financial press since then as HP’s key argument is that they overpaid for Autonomy because of accounting manipulation. This is strongly denied by Automony founder Mike Lynch.
- Hewlett-Packard accountants sued over Autonomy purchase (BBC 29 Nov 2012)
- US to probe Autonomy sale to Hewlett-Packard (BBC 27 Dec 2012)
- Autonomy’s Lynch defends record as HP confirms Federal probe (Reuters 28 Dec 2012)
Aswath Damodaran’s Musings on Markets blog makes a strong case that even if HP is right this only accounts for $2.45 billion of the $8.8 billion write off – see HP’s Deal from Hell: The mark-it-up and write-it-down two-step.
The write off raises issues about the acquisition in terms of corporate strategy, leadership, corporate governance as well as the accuracy of Autonomy’s accounts.
Resources for more information:
Thomson One Banker – a deals module search will provide details of the deal: announced 18 Aug 2011, effective 3 Oct 2011, “UK – Hewlett-Packard Vision BV of the Netherlands, a unit of by Hewlett-Packard Co (HP), completed the tender offer to acquire the entire share capital of Autonomy Corp PLC (Autonomy), a
Cambridge-based developer of infrastructure and information management software, for GBP 25.5 (USD 42.09)” [SDC deal number 2337968040]
[Update June 2014 – Thomson ONE.com is (or T1.com) is Thomson Reuters replacement product for Thomson One Banker.]
Thomson Research – analysts reports – For example, on 23 Aug 2011 Marc Geall of Deutsche Bank published a report on Autonomy Corp plc. This reported a change of recommendation to sell, since the shares were GDP 24.86 almost fully valuing the HP offer, and substantially higher that Deutsche Bank’s fundamental target price of GBP 17.50.
Business Source Premier (EBSCO): – several trade journals with articles on the HP aquisition of Autonomy. For example,
Forbes.com (2012) ‘With Autonomy, H-P Bought An Old-Fashioned Accounting Scandal. Here’s How It Worked’ Forbes.Com, (November 20, 2012):p. 39, Business Source Premier, EBSCOhost, viewed 11 January 2013.
See also those posts with the mergers_and_aquistions tag.
The possible merger of BAE Systems and EADS is much reported in the financial press at the moment.
Using the Factiva business news database we can see that there have been almost 100 articles about BAE Systems in the Financial Times alone in the last 3 months (almost all about the proposed merger).
However, there is not yet anything definite. On 12 Sept 2010 BAE Systems issued an official statement. “Further to the recent movement in BAE Systems’ share price, BAE Systems plc (BAE Systems) and EADS N.V. (EADS) confirm that they are in discussions regarding a possible combination of their businesses. …” (RNS Number 1353M from PI Navigator). There is no specific merger proposal, so there is very little detail that can be recorded in a Merger and Acquisition database.
Although the merger is only possible. It is likely to be included in reports be Analysts who follow either of these companies. (Some analysts may delay producing a report until there is a specific merger proposal.)
See also (earlier posts)
- Mergers and acquisitions databases (Nov 2011)
- Researching mergers and acquisitions (Jan 2011)
- Deals info from Thomson One Banker (Mar 2011)
Mergers and acquisition research can involve much more that the financial details of the deals, and remember not all deals are successfully completed.
Update 10 October 2012: EADS and BAE call off merger
- “BAE Systems and EADS announce that they have decided to terminate their discussions” (RNS Number 13955O from PI Navigator).
- EADS, BAE call off world’s biggest arms merger (Thomson Reuters)
- EADS-BAE Pull Plug on Merger Amid Government Opposition (Bloomberg)