Tech, healthcare mega deals boost virus-stricken M&A market

 

This week, Nvidia Corp NVDA.O unveiled a $40 billion agreement to acquire chip maker Arm Ltd from SoftBank Group Corp 9984.T, while Gilead Sciences Inc GILD.O inked a $21 billion deal for biotech company Immunomedics Inc IMMU.O.

They are the latest examples of companies whose business is minimally affected by, or in some cases benefiting from, the pandemic’s financial fallout and which are embarking on big acquisitions.

“They’ve largely learned to do work from home for their own business, and now it’s about strategic deployment of capital,” said Tom Miles, co-head of mergers and acquisitions (M&A) for the Americas at Morgan Stanley.

To be sure, U.S. M&A volume so far in 2020 is down nearly 50% on the same period in 2019, Refinitiv data showed. But of the $715.9 billion spent on acquisitions this year, 41% has gone towards either a technology or healthcare transaction.

Tech deals account for 27% of deal volume, the highest level for this point in a year in the last 23 years, and are up 37% year-on-year.

Source:  https://www.reuters.com/