Global forest, paper and packaging deals insights: Q2 2019

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Executive summary

After a three-year low in M&A activity in the first quarter of 2019, deal activity has picked up this quarter. Global forest, paper and packaging deal value and volume rose 174% and 39%, respectively. However, compared to YTD 2018, value and volume declined by 75% and 25%, respectively.

The lack of megadeals continues in 2019 contributing to lower deal value compared to 2018. Flexible Packaging and Miscellaneous Products was the most active category representing 81% and 53% of the value and volume this quarter, respectively.

fpp-deals-activity

Key trends and highlights

  • In Q2 2019, deal value grew noticeably by 2.7x to $6 billion over Q1 2019. Deal volume also grew by 39% to 129 deals in the current quarter over the previous quarter.
  • The increase in deal value in Q2 2019 is due to the Flexible Packaging and Miscellaneous Products category. Six out of the top ten deals are of this category, contributing ~$4 billion, i.e., 81% of total deal value.
  • The average deal size increased by 91% to $94.5 million in Q2 2019 vis-à-vis Q1 2019. But for YTD 2019, the average deal size declined by 72% when compared to YTD 2018.

“Despite a pick-up in activity this quarter, macroeconomic uncertainty continues to influence M&A. This is pushing investors to be more strategically selective with their M&A objectives.”

Max Blocker - Global Forest, Paper and Packaging Deals Leader

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Max Blocker

US and Global Forest, Paper and Packaging Leader, PwC US

Harry Gruits

Forest, Paper and Packaging Deals Leader, PwC US

Jason Boyer

Canada Forest, Paper and Packaging Deals Leader, PwC Canada

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