Image: Shutterstock

To state the obvious, the outlook for M&A and the world's capital markets is looking a little different these days.

While deals are still getting done, the pace is down compared to last year. According to data from Refinitiv, M&A activity through the end of February—before the coronavirus crisis in the United States had begun to truly accelerate—was down 49% year-over-year. 

The oil and gas sector, to cite one example, saw deal volume down by 26% and deal value 15% lower between Jan. 1 and March 15, compared with the same period last year, according to analytics firm GlobalData.

On the buyout front, some transactions are being pushed back. French pharmaceutical company Curium Pharma, for example, has delayed its potential $3 billion sale and will reevaluate its strategic options "in due course," Bloomberg reported.

Initial public offerings are being delayed too. Warner Music Group and Cole Haan both postponed offerings, and buyout firm Carlyle Group delayed the U.S. IPO of its German specialty chemicals group Atotech.

There is some opportunity, though, particularly in the private equity markets. Close to a decade of growth blurred the lines between the public and private investment markets, but some see opportunity for private equity firms now that company valuations have been dramatically reduced, particularly for firms that are sitting on piles of cash to invest in distressed companies. 

"To some degree this is a good reset for the PE industry. The dramatic drop in the public markets at least illustrates the difference between the two models," White & Case partner Matthew Hurlock said of the gap between private equity and public vehicles for investment. "The positive side for PE is that you have a group of senior executives taking over who are deeply focused on saving the company and not having to do it in the public eye."

Still, many private equity firms, Hurlock said, have portfolio companies that are now in trouble, and funds will be straining to keep those companies afloat if they are going to recoup that investment down the road. 

Hurlock also said companies that have seen their valuations fall suddenly may resist private offers. Already-distressed companies would likely be the first to entertain buyouts, he said.

He noted that his clients are now asking a lot of questions related to employment law and maintaining liquidity when clients are canceling orders, questions many have not had to ask in the past. 

"Hopefully, this will not be as long and painful as some are suggesting," Hurlock said. 

There's always hope. In the meantime, here are some deals that did go through: 

PepsiCo/Rockstar Energy Beverages

Working from home can be … draining. So why not give yourself a little boost? PepsiCo has agreed to purchase energy drink company Rockstar Energy Beverages for $3.85 billion. Rockstar, founded in 2001, markets itself as the energy drink for "active lifestyles," and has over 30 flavors that are marketed in 30 different countries. PepsiCo is no stranger to the energy drink market. The company already has a portfolio of energy drinks under its umbrella, including Mountain Dew's Kickstart, GameFuel, and AMP. Red Bull, watch your back. 

Gibson, Dunn & Crutcher and Davis, Polk & Wardwell for PepsiCo/King & Spalding for Rockstar Energy Beverages

Hellman & Friedman/Checkmarx (Insight Partners)

Private equity firm Hellman & Friedman has entered into an agreement to purchase cybersecurity company Checkmarx from venture capital firm Insight Partners. The valuation of the company is $1.15 billion. Checkmarx was founded in 2006 and has 1,400 customers in 70 countries. The company said that 40 of the Fortune 100 currently use its product. 

Simpson Thatcher & Bartlett for Hellman & Friedman/Willkie Farr & Gallagher for Checkmarx (Insight Partners)

Veritas Capital/DXC Technology

New York-based private equity firm Veritas Capital has agreed to purchase the health and human services resources unit of Tyson's Corner, Virginia-based IT company DXC Technology for $5 billion. The purchase price reflects a 3.5x multiple of the DXC division's 12-month sales figure of $1.4 billion. 

Schulte, Roth & Zabel for Veritas Capital/Latham & Watkins for DXC Technology

Costco/Innovel Solutions (Transform Holdco)

Membership-only wholesaler Costco has agreed to purchase last-mile delivery company Innovel Solutions from parent Transform Holdco for $1 billion. Innovel has serviced Costco since 2015 and is part of Costco's efforts to boost its online sales of larger items such as furniture, appliances, television and fitness equipment, the company said. Shares of the Washington-based big-box retailer rose 3.5% on March 17, the day the deal was announced. 

Wachtell, Lipton, Rosen & Katz and DLA Piper for Innovel Solutions (Transform Holdco)

KKR/ Viridor (Pennon Group)

Global private equity powerhouse KKR has agreed to purchase U.K.-based waste management company Viridor from the company's parent, Pennon Group, for $4.95 billion, the company said. According to The Financial Times, Pennon Group had higher offers for the division, but decided to go with KKR because the company felt that in the current climate, KKR was the most likely to provide "certainty" to Viridor moving forward. 

Simpson Thatcher & Bartlett for KKR/Allen & Overy for Viridor (Pennon Group)

Read More:

Deal Watch: Firms Face Shifting Winds as Virus Strikes, US Race Is Reshaped

Deal Watch: In the Home Stretch for Sprint and T-Mobile

Davis Polk, Skadden Snag Roles in Morgan Stanley's $13 Billion E*Trade Buy