Vodafone-Verizon deal helps push global M&A value up 5.5%

Lawyers are buoyed by growing boardroom confidence following a pick-up in global M&A activity during the last quarter, dominated by the rise of mega deals.

The $130bn (£80.1bn) Vodafone-Verizon deal, which marked the largest US-based corporate deal on record since 2001, is largely responsible for making September the top month by deal values this year so far, pushing many of the law firms to take roles on the deal into the top 10 global advisers of the quarter by value, according to data from Mergermarket.

The value of global M&A for Q1-3 this year totals $1,606.7bn (£989bn), a 5.5% increase on the same period in 2012, with 2013 on track to see the highest total since 2008. The recent stabilisation of the European economy is also reflected in M&A activity, with a 41.5% rise in deal values from Q3 2012 to Q3 2013.

Charles Meek, corporate head at Macfarlanes, said: "Our role on the Verizon deal has kept a lot of people busy. But we are now seeing a bit of a pick-up in activity across the board and, although deals are still taking time and still carry quite a bit of uncertainty, we are reasonably optimistic for the rest of the year. The current economic news and the absence of a recent euro crisis seem to be helping."

Macfarlanes has jumped to eighth place in the European league tables by value, and eleventh globally for Q1-Q3, after landing a role for Verizon. Davis Polk & Wardwell, Wachtell Lipton Rosen & Katz and Simpson Thacher & Bartlett, which also took roles on the tie-up, fill the top three slots in the global value tables. 

Other major deals to date this year have seen Berkshire Hathaway and 3G Capital acquire food giant Heinz in a $28bn (£17bn) transaction, handing roles to firms including Freshfields Bruckhaus Deringer, Kirkland & Ellis and Davis Polk.

Ben Spiers, co-head of M&A at Freshfields (pictured), commented: "With some CEOs being bolder this will no doubt help others – M&A is so much about confidence. The Ribena/Lucozade deal was also interesting as it shows Japanese buyers are now more willing to enter into big public auctions and win them – we are seeing the same with Chinese bidders. We are quietly confident. When you see one deal in a sub-sector that is often followed by others in the same space."

Freshfields' role on the Heinz deal, as well as the £1.35bn Ribena acquisition, helped propel it to third place in the European rankings by volume, while DLA Piper and Linklaters took first and second place respectively, reversing their positions of the previous quarter.

Tom Shropshire, corporate and capital markets partner at Linklaters, said: "We are sensing more activity in the US at this stage of the economic upturn. The continuing challenge is that, while there are big deals, we still would like to see a steady flow of smaller and medium-sized deals to complement that larger deal activity. We are cautiously optimistic about the months ahead, particularly if IPOs start happening; however, there are 'headwind' risks, including the US Government shutdown and spending limits."