What’s the Deal? Researching Specific M&A Deals

Companies make acquisitions for two primary reasons: (1) to fill a strategic gap (products, resources (people), or capabilities) or (2) enable the company to enter a new market with a new revenue stream. Researching a company’s M&A activity provides insight into the corporate strategy. When researching a specific deal, we are often looking for deal financials and deal valuation. It’s also important to research the strategies behind the deal. We often want information on business drivers, overall strategy, execution plan, implementation, etc.

Let’s take a well-known deal as an example, eBay’s acquisition of Paypal. In 2002, eBay, the largest online auction platform bought, PayPal, a web-based payment service, for $1.5B. The deal was a perfect match – Paypal drove eBay’s revenues while eBay supported the growth of PayPal’s active user base. A decade later, it is evident that both businesses fueled each others growth. So how does one research a specific deal?

Start with Thomson One for deal information including deal financials, news, filings, and research.

Note that this database only works in Internet Explorer versions 7-9. Take a look at our blog post for an IE10 workaround or Chrome plug-in.

Go to Screening & Analysis => Deals & League Tables => M&A => Advanced Search.

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Select your criteria (e.g. Company Info => Name => Target => Paypal). Then click Preview. Click on the icons next to the deal to view the tearsheet and additional information. Below is a small portion of the deal tearsheet.

Deal Values

In addition to the analyst reports you can get from the Research tab, go to Screening & Thomson One Analyst SearchAnalysis => Research => Research Search. For analyst reports on this deal select eBay as the company. Then search forPaypal in the Title/Text field under ‘More Options’. Change the date range to closer to the deal date.

For filings (ARS and 10-K) go to Company Views => Filings => Company Filings.

Zephyr Search

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Zephyr, a part of the BvD suite of databases, contains data on M&A activity, IPOs, joint ventures and private equity deals with links to detailed financial company information. Use the default search option to search for eBay and Paypal, then select the deal from the list of results.

You can get similar deal information here, but in addition to deal financials is a section on ‘Deal comments & rationale’ where you can find qualitative information like this quote from eBay’s CEO, Meg Whitman:

“EBay and PayPal have complementary missions. We both empower people to buy and sell online. Together we can improve the user experience and make online trading more compelling. We can also capture greater value from the e-commerce opportunities occurring both on and off our site.”

In addition to searching within databases that specifically cover M&A, searching the literature will be helpful too. Look for articles that discuss the deal from around the time that the deal took place. For articles about the merger use Business Source Complete. This is a business journal article database covering both trade, general business, and scholarly journals.

Here you will want to search for the company names in the CO Company Entity field and use the subject heading CONSOLIDATION & merger of corporations. When viewing the results, use the left-hand menu to adjust your date range. For example try a search like:

Ebsco search

ABI/Inform is another business journal article database that you can search. This database is similar to Business Source Complete, but contains unique content as well. Use similar search techniques, but use the subject heading acquisitions & mergers.

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Use Factiva to find news articles about the merger.

Go to Search => Search Builder. For this example, you might try a search like:

  • Select eBay as the Company
  • Select Acquisitions/Mergers/Takeovers as the Subject
  • Search for Paypal in the Free Text Search Box. Select to search for free text terms in the Headline or Lead Paragraph under ‘More Options’
  • Adjust your date range to closer to the 2002 deal

For additional information see our Business FAQ “Where do I find info on mergers and acquisitions?” as well as our previous posts on Zephyr, Bloomberg’s M&A database, and M&A Rumors.

1 thought on “What’s the Deal? Researching Specific M&A Deals

  1. Mergers and acquisitions are not as basic as venturing into the business sector, tapping an intrigued purchaser and auctioning off an organization. Non-budgetary viewpoints, for example, the goodwill conveyed by an organization likewise assume a part in guaranteeing the right deal.

    Whether you are wanting to offer your own particular business, or purchase an organization in an arranged way, mergers and acquisitions need to guarantee that the deciding outcome is a powerful and successful deal for everyone included.

    Valuating the business is just the first step. Most organizations result in these present circumstances organize after some examination around loved ones with respect to the value of the organization. Valuation of the organization will normally quickly take after any choice to partake in a mergers and acquisitions deal. On account of incomprehensible organizations, there are particular mergers and acquisitions experts who are answerable for the choice from the earliest starting point to the end, including valuation of the organization.

    Mergers and Acquisitions

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