The number of mergers and acquisitions in the consumer discretionary sector announced in the second quarter of 2020 fell to a low last seen in the early 2000s, data compiled by S&P Global Market Intelligence shows.
A total of 587 deals were struck during the quarter, down 44.4% from 1,055 in the year-ago period. It was the fewest number of transactions in any three month period since the first quarter of 2004.
Total M&A activity in value terms fell 58.3% to $25.58 billion from
For the three months to June 30, Just Eat Takeaway.com NV's purchase of Grubhub Inc. was the largest transaction at $8.13 billion. The Dutch e-commerce company said its loss for the first fiscal half of 2020 widened year over year due to expenses related to the acquisition.
The second-largest deal in the quarter was Chinese electronics producer TCL Technology Group Corp.'s deal for Tianjin Zhonghuan Electronic and Information (Group) Co. Ltd. for 11 billion Chinese yuan.
This was followed by Evolution Gaming Group AB's offer for NetEnt AB for 19.6 billion Swedish kronor. Evolution Gaming needs the acceptance of 90% of NetEnt shares by Oct. 26 for the deal to go through.
Amazon.com Inc.'s acquisition of self-driving vehicle company Zoox Inc. was the fourth-largest deal during the quarter at $1.3 billion, according to S&P Global Market Intelligence data. Amazon intends to create at least $100 million in stock awards after the purchase so it could keep Zoox's more than 900 workers.
The fifth-biggest transaction was auto-parts retailer China XD Plastics Co. Ltd.'s sale of a 50.6% stake in the business to Nevada-based Faith Dawn Ltd. for $1.20 per share.
The Grubhub deal ensured that the e-commerce segment was the biggest contributor to consumer discretionary M&A activity at $8.50 billion, a 98.4% jump from $4.28 billion in the year-ago period.
The hotel, restaurants and leisure segment recorded an 85% drop in value to $4.87 billion from $32.43 billion in the second quarter of 2019, when Expedia Group Inc. purchased Liberty Expedia Holdings Inc.