Medicines and Mines Help Dealmakers Defy $900 Billion M&A Slump

The hunt for medicines to treat rare diseases and a flurry of mining deals are again providing respite to the slump in mergers and acquisitions.

(Bloomberg) — The hunt for medicines to treat rare diseases and a flurry of mining deals are again providing respite to the slump in mergers and acquisitions.

With global transaction values standing at $1.1 trillion this year — about $900 billion less than at this point in 2022 — just a handful of industries are keeping dealmakers busy.

One of them is health care, with acquisitions targeting the sector up 24% to $157 billion, data compiled by Bloomberg show. A theme underpinning deal flow here is drugmakers’ desire to shed legacy treatments and go in search of the next blockbusters.

Novartis AG kicked off the week by saying it will buy Chinook Therapeutics Inc. for as much as $3.5 billion to add promising treatments for a kidney disease that lacks targeted medicines. It comes as the Swiss pharma group looks to sell some ophthalmology assets and spin off its generic drug unit.

Another corner of markets where M&A is buoyant is commodities. Deal values in the sector are up by more than a third this year to $90 billion, the Bloomberg-compiled data show, will little sign of slowing.

Bloomberg reported that US agribusiness Bunge Ltd. is nearing an acquisition of Glencore Plc-backed grain business Viterra. Combining the two will create a $25 billion trader big enough to take on the industry’s elite, including Minneapolis-based Cargill Inc. A deal could be announced as soon as Monday or Tuesday.

It would also free up Glencore to pursue its grander M&A ambitions. The commodities giant is now in talks to buy Teck Resources Ltd.’s coal assets. It’s the latest twist in a $23 billion takeover saga that’s already seen Glencore thwarted in its attempts to buy all of the Canadian miner — something it hasn’t given up on.

Any move to shed coal would allow Teck to focus on mining industrial metals. This is another trend that’s been keeping dealmakers active in 2023, with demand soaring for metals like copper and nickel that can be used to make batteries for electric vehicles. Russian metal industry veteran Artem Volynets’ blank check firm ACG Acquisition Co. has confirmed a Bloomberg report that it will acquire nickel and copper mines in Brazil for $1 billion.

Merger Mondays have been few and far between this year, but a handful of other transactions are making this a busy start to the week.

In the biggest announced deal of the day so far, US stock exchange operator Nasdaq Inc. will purchase financial software provider Adenza for $10.5 billion in cash and stock from buyout firm Thoma Bravo. It’s Nasdaq’s largest-ever acquisition.

In the industrials sector, Swiss company Georg Fischer AG has made the strongest bid yet to buy the Finnish plumbing-equipment manufacturer Uponor Oyj for €2.1 billion ($2.3 billion). Belgian building materials group Aliaxis SA remains in the wings, having already been rejected by Uponor.

And KKR & Co. has raised its bid for Telecom Italia SpA’s landline network to as much as €23 billion — giving the US private equity firm an edge over its rival, the Italian state lender Cassa Depositi e Prestiti SpA, Bloomberg reports.

More stories like this are available on bloomberg.com