Global engineering and construction (E&C) M&A deal values continue to reflect softness in 2016 versus prior years, but masking healthy deal volume. While both value and volume declined in Q3 2016 compared to comparable 2015, on a relative year-to-date basis 206 deals through Q3 2016, outpaces 2015 and 2104 (187 and 103, respectively) demonstrating heightened activity for smaller transactions. There were 66 deals this quarter, with the Construction Materials Manufacturing category contributing 26 and Construction 16 of the 66 deals.
Overall Q3 2016 deal value increased by 13% from Q2 2016 but decreased 30% from Q3 2015. On a YTD basis, 2016 average deal size decreased by 10% to $410 million versus $452 million in 2015. Civil Engineering registered the highest growth on both year-over-year and quarter-over-quarter basis. Construction and Home Building declined 34% and 31%, respectively, from Q2 2016, but increased 38% and 76% when compared to Q3 2015.
There were five megadeals announced in Q3 2016, unchanged from Q2 2016 and Q3 2015. The largest deals were Xinjiang Dushanzi Tianli High & New Tech Co. Ltd.’s acquisition of China National Petroleum Corp.’s E&C assets for $4.2 billion, and Komatsu America Corp.’s acquisition of Joy Global Inc. (valued at $2.8 billion).
For our full report and additional information on the Top 10 Deals announced for the year, our regional and subsector analyses, and the Outlook for this sector, please remember to download our Global Engineering and Construction M&A Deals Insights: Q3 2016 update.
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