The coronavirus pandemic has taken a significant toll on the world. From a public health standpoint it has been disastrous and hundreds of thousands of individuals have tragically passed away. The economic situation is also bad with the economy taking a turn for the worse, entering a recession, and leading to high unemployment rates. From a mergers and acquisitions perspective, the volume of transactions has remained 33% lower than 2019 levels. However, over the weekend, there was a fantastic day on the M&A market. Dealmakers saw $69 billion in transactions. According to Bloomberg, it was the “highest tally for the start of the week since late November 2019.” So, what happened on the M&A market? A few key companies made major transactions. Among them include Nvidia, Gilead, Oracle, Verizon, and Garda.
Nvidia Corporation made a deal with SoftBank’s technology chip division called Arm Ltd. The purchase was for $40 billion. Nvidia made a cash and stock deal with SoftBank. Their desire to purchase Arm stems from their objective of incorporating artificial intelligence into all technological products.
Gilead, a pharmaceutical company, agreed to a $21 billion dollar deal with Immuomedics. Gilead has recently tried to turn towards drugs that harness the power of the immune system to fight tumors and cancerous growths. Immunomedics has technology approved by the FDA for its breast cancer treatment TrodeIvy. Gilead plans to incorporate the new technology into its repertoire.
The acquisition of TikTok has been a hot topic for quite some time after President Trump threatened banning the app unless it was purchased by an American company. Initially Microsoft appeared to be the most likely buyer, however, over the weekend Oracle won the bid.
The cellphone and communications company Verizon will acquire TracFone Wireless for $6.9 billion. The decision to purchase TracFone Wireless stems from Verizon’s plan to expand its prepaid mobile phone business as they have not invested many funds into the prepaid phone market and instead largely rely on subscribers.
Garda, a Canadian private security firm, will acquire United Kingdom security firm G4S for $3.8 billion. This comes after three months of unsuccessful negotiations between the two companies.
In summation, though the market has taken a hit due to coronavirus, there remains hope. The mergers and acquisitions market is still doing well and it foretells gains in other industries. The pandemic is still waging, but this past weekend’s market activities are a positive sign.
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