After Nearly $6 Trillion in M&A Activity Took Place in 2021, This Year is Shaping Up to Be Even Larger

After Nearly $6 Trillion in M&A Activity Took Place in 2021, This Year is Shaping Up to Be Even Larger

USA News Group – According to analysts at KPMG, this year could be an even bigger year in terms of M&A activity, compared to 2021’s record breaking year of $5.9 trillion in deals. The latest blockbuster deal involved the $8.5 billion acquisition of MGM by Amazon, Inc. (NASDAQ:AMZN), which Forbes is reporting could potentially be undone someday by the FTC under the guise of further antitrust reviews. However, other reasonably large deals could still be on deck, as many there has been much speculation about a potential merger of AT&T Inc. (NYSE:T) and DISH Network Corporation (NASDAQ:DISH), a takeover of Electronic Arts Inc. (NASDAQ:EA), and the completion of a premium takeover proposal of Petroteq Energy, Inc. (OTC:PQEFF) by Viston United Swiss AG.

There’s a significant premium price is on the table from Viston United Swiss AG to takeover clean energy technology company Petroteq Energy, Inc. (OTC:PQEFF).

At its offered C$0.74 price point, the takeover represents to shareholders approximately 279% over the closing price of the Common Shares on the TSX Venture Exchange on August 6, 2021. That’s a 1,032% premium overthe 52-week volume weighted average trading price on the TSX-V prior to the offer originally made in April 2021.

The offer itself is also a 100% all-cash consideration, representing an instant payback to current shareholders. Currently, through its US shares on the OTC under the PQEFF symbol, shares of Petroteq are trading around US$0.3505 (C$0.44) on March 21, 2022. At that price point, the C$0.74 still represents a potential 68% premium over the more current trading price.

After being given a deadline extension of April 14, 2022, Petroteq’s Board Members shared their unanimous intention to tender their shares through the offer.

“After thorough consideration of all aspects of the Viston Offer, the advice provided by Haywood and consulting with its other advisors, the Board has unanimously determined to recommend that Shareholders accept the Viston Offer and tender their Common Shares,” said the Board in their official statement.

Petroteq specializes in oil production, having developed proprietary technologies that enable the company to produce oil without water, waste tailings ponds and emissions. In addition to sustainable oil production, their technology cleans oil sands of all hydrocarbons, creating a purified sand as part of an overall ESG strategy.

So far, Petroteq has announced its willingness to assist Viston with its CFIUS filings.

"We are particularly pleased with the recognition this shows of our technology which we have taken from inception to commercial viability as a one of its kind in oil sands eco-friendly, green extraction,” said former Petroteq Chairman and CEO, Dr. Gerald Bailey, who retired in January. “We had always forecast a great future. However, we respect the value of this offer to shareholders and if it can be achieved it will reward our many dedicated supporters."

When Amazon, Inc. (NASDAQ:AMZN) made the acquisition of MGM public, it paid a 60% premium over the studio’s then market cap of $5.5 billion. Other estimates have the purchase at only a 41% premium over earlier valuations made by Apple and Comcast.

The deal is the second largest purchase in Amazon’s history, with only the $13.7 billion acquisition of Whole Foods in 2017 being larger.

“The acquisition’s thesis here is really very simple: MGM has a vast, deep catalog of much-loved intellectual property,” said Amazon founder and soon-to-be ex-CEO Jeff Bezos. “With the talented people at MGM and Amazon Studios, we can reimagine and develop that IP for the 21s Century."

With the purchase, Amazon will now own a library with more than 4,000 film titles, including the James Bond and Rocky movie franchises, as well as a TV library of more than 17,000 episodes, from series including Fargo and The Handmaid's Tale.

The Bond franchise is still alive, with its last film, 2015’s Spectre, grossing more than $880.6 million in global box office. As well, Amazon is also getting the raw footage and everything else associated with the Donald Trump reality show, The Apprentice. It’s widely speculated that Amazon might take control of a treasure trove of unreleased behind-the-scenes footage and outtakes that are potentially embarrassing to the former U.S. president.

Last year a new wireless partnership between AT&T Inc. (NYSE:T) and DISH Network Corporation (NASDAQ:DISH) signaled to the market a potential future merger. A year later in January of 2022, talks of the merger heated up again, after a previous attempt two decades prior was stopped by regulators.

Both companies have lost customers over the last 5 years, as AT&T’s DirecTV now counts more than 15 million customers compared with 25 million in 2017, and Dish Network’s dropped from 13 million to 8.4 million.

Back in 2002, the two tried to merge, but the FCC and Department of Justice’s competition unit shot it down. However, now 20 years later, both companies see the landscape differently than it once was.

“I think it's inevitable that Dish and DirecTV go together,” said Dish Network Chairman, Charlie Ergen during Dish’s Q4 earnings conference call with analysts. “Otherwise, both companies will just melt away, and there'll be no service for customers. The regulatory reasons to not allow it, don't exist anymore.”

Speculation over the future of video game giant Electronic Arts Inc. (NASDAQ:EA) has been talked about since mid-January, heating up especially since the Microsoft takeover of Activision/Blizzard at a potentially 50% premium over the company’s then market cap.

Back in January, a similar 50% premium on Electronic Arts’ then market cap of nearly $40 billion would’ve fetched a $60 billion price point. Now after a few months of declines, EA has a market cap of nearly $35.3 billion, which would now bring in just under $53 billion at a 50% premium.

Last year, Electronic Arts was a part of an investment blitz of more than $3 billion worth into video games by Saudi Arabia’s sovereign wealth fund. Now analysts believe that larger media groups such as Sony, Apple, Disney, and even Amazon, could make a serious move into the video game space.

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