A $14 billion tie-up between U.S.-based chemicals firm Huntsman Corp (>> Huntsman Corporation) and European rival Swiss Clariant AG (>> Clariant AG), announced on Monday, is the latest example of the spate of big deals between the two regions.
The overall value of cross-border M&A deals between the U.S. and Europe is up 82 percent on the same period last year, according to Thomson Reuters data, and the highest over the same timeframe since at least 2007.
Interest in major cross-border deals was underscored earlier this year when Kraft Heinz Co (>> Kraft Heinz Co) made a surprise $143 billion bid for Unilever (>> Unilever plc) (>> Unilever), only to withdraw it less than 48 hours later, while U.S. healthcare giant Johnson & Johnson (>> Johnson & Johnson) clinched Swiss biotech company Actelion (>> Actelion Ltd) in a $30 billion all-cash deal.
Optimism over U.S. President Donald Trump's economic agenda has buoyed stock markets worldwide, as well as the U.S. dollar, which has made foreign acquisitions cheaper for U.S. companies.
Low interest rates are also keeping down borrowing costs.
Switzerland and the Netherlands have so far been the main shopping destinations for companies on the other side of the Atlantic, with U.S. buyers announcing a combined $70.2 billion worth of deals in those two countries this year, the data shows.
But some European companies have been fighting hard for their independence.
Shareholders in Dutch paint maker Akzo Nobel (>> Akzo Nobel), angered by its rejection of a 26.3 billion euro ($29.6 billion)takeover proposal from U.S. rival PPG Industries (>> PPG Industries, Inc.), took their fight to an Amsterdam court on Monday.
Britain remains Europe's biggest acquirer in the United States, with deals totalling $21.1 billion so far this year, followed by Switzerland with $11.5 billion.
In February, Reckitt Benckiser (>> Reckitt Benckiser Group Plc) announced a deal to buy U.S. baby formula maker Mead Johnson Nutrition (>> Mead Johnson Nutrition CO) for $16.6 billion, giving the British consumer goods company a new product line and expanding its presence in developing markets where Mead Johnson has a strong footprint.
Bank of America Merrill Lynch, which advised Reckitt Benckiser on that deal, leads the list of financial advisers on cross-border transactions announced between U.S. and European companies, with $83.1 billion worth of deals so far this year.
That represents 48 percent of the total, according to Thomson Reuters data.
(Reporting by Pamela Barbaglia; Editing by Mark Potter)
By Pamela Barbaglia
Stocks treated in this article : Johnson & Johnson
, Akzo Nobel
, Huntsman Corporation
, PPG Industries, Inc.
, Mead Johnson Nutrition CO
, Clariant AG
, Actelion Ltd
, Reckitt Benckiser Group Plc
, Unilever plc
, Kraft Heinz Co