How are takeover bids faring in France? According to AMF figures, the number of takeover bids is rising sharply. At the same time, the amounts involved are falling. Experts at AURIS Finance, a mergers and acquisitions consultancy, give you their analysis.
A takeover bid is an operation in which a company attempts to take control of a listed company by buying shares from its shareholders. Some takeover bids are described as “hostile”, where the action is taken against the wishes of the target company’s management. This is the case, for example, with Veolia’s recent bid for Suez. In France, other takeover bids have made history, such as Antoine Riboud’s takeover of Saint Gobain in 1968. More recently, some transactions have hit the headlines, such as Total’s takeover of Elf or Thales’s takeover of Gemalto.
42 offers in 2021, totalling €5.8 billion
What about the takeover market in 2022? After a record year for mergers and acquisitions in 2021, takeover bids are also on the rise. According to the 13th Observatoire des offres publiques (observatory on public offers), the number of takeover bids reached a ten-year high in 2021. A total of 42 takeover bids were approved by the AMF in 2021, compared with 29 the previous year. In detail, the amounts involved are decreasing. The total amount of capital acquired as a result of transactions closed in 2020 was €11 billion, compared with €5.8 billion in 2021.
Financial institutions and investment funds at the forefront
These figures conceal major disparities. In 2020 and 2021, the total volume of deals was largely driven by very large transactions. In 2020, 63% of the €11 billion was attributable to Worldline’s bid for Ingenico, while in 2021, BPCE’s bid for Natixis alone accounted for 46% of the €5.8 billion worth of transactions closed. The rest of the operations involved smaller companies. As in the M&A market, the Observatory notes that financial institutions and investment funds are playing an increasingly important role in takeover bids. In 2021, they were involved in 70% of bids, up from 40% a year earlier. Another notable finding is that the premium offered, i.e. the difference between the purchase price of the shares and their market price at the time of the announcement of the operation, is rising sharply. On average, it increased by 32% in 2021, compared to 28% last year.
Get the support you need
Two signs that the takeover market, like the M&A market, is very dynamic at the moment are the appetite of investment funds and rising premiums. Indeed, liquidity remains high and both financial institutions and companies are looking for new targets. As a result, all strategies are being explored to secure the coveted company: acquiring a company through an M&A operation or acquiring a stake by buying shares on the financial markets. Whatever your situation, AURIS Finance specialists are at your side. Thanks to their sector-specific expertise, they are able to advise you on the best way to sell your company.
