Review: M&A trends in 2018 from Admincontrol`s perspective

Despite Europe reaching its highest value share of global M&A (28%) since 2014, some dealmakers have been concerned about the slowdown in activity in H2, and whether 2019 will return to the levels seen in recent years (Mergermarket’s “Global & Regional M&A Report 2018”).

Strong year for  Admincontrol

Slowdown in the market or not, in Admincontrol we have been invited to be part of a significant number of M&As in the Nordic markets in 2018. It was a strong year for Admincontrol, and we saw an 18% increase in total sales for Virtual Data Rooms in the Nordic markets compared to 2017. We are also excited to see that this positive trend is continuing in 2019 with a good start of the year. In our biggest market, Norway, we have seen an increase in market share from 47% in 2017 to 50% in 2018.

“We delivered and facilitated 922 Virtual Data Rooms last year, which is 200 more than the previous year. We were also excited to see some really big deals coming through in the UK and we are looking forward to seeing more activity in this market in the years to come,” says Mari Nygård, Head of Virtual Data Rooms.

Want to offer a global platform

Nygård explains that Admincontrol has recently employed more sales representatives in the UK in order to become a player in Europe’s biggest M&A market.

In the coming years, we have ambitious plans to move from being primarily a Nordic player to offering a platform for the global market.

Mari Nygård, Head of Virtual Data Rooms

Better results with a Virtual Data Room  

In 2018 we saw that companies of all different sizes were using Virtual Data Rooms.

“It`s becoming more common to also use a Virtual Data Room when preparing for a potential acquisition, merger or exit. In 2018 we saw that companies of all sizes used Data Rooms when they were conducting due diligences to ensure that their transactions were supported in the most optimal way possible. We also noted that pharma and medtech companies were clearly on the rise”.

Today, the average live-time in a Data Room is about 11 months.

In 63% percent of transactions, the option to share and discuss using the Q&A function is key and, on average, there are 118 new questions during a due diligence process.

Looking at last year in more detail, we have noted the following trends: 

1. Companies are more security-minded

In 2018 we also witnessed a greater demand for Clean Rooms – an increase from 16 in 2017 to 60 in 2018.

“A Clean Room is basically a Data Room within a Data Room and is used to share information with highly restricted access. We see that companies are becoming more aware of who they share their data with. Combined with our focus on customers using Data Room tools correctly, this has resulted in a greater demand for Clean Rooms,” says Mari Nygård. Read more about Clean Rooms here.

2. Energy, Mining & Utilities sector

In line with global trends, the Energy, Mining & Utilities sector was the most targeted sector by value with a total of USD 152.5 billion (402 deals) announced in the last 12 months in Europe. This represented the highest value in the sector since 2012 as interest in North Sea assets, as well as an ongoing push towards cleaner energy, drove investments (Mergermarkets: Monthly M&A Insider).

Admincontrol is very proud to have been the Virtual Data Room provider for many spectacular deals in this sector such as when Vattenfall, PKA and Vestas signed an agreement for a joint venture to build Sweden`s largest wind power plant last year.

“In Sweden we have seen an increase in renewable energy transactions related to solar and wind power. The value of these transactions is very high. A Virtual Data Room, with high security and necessary features, is therefore crucial”, says Head of Virtual Data Rooms in Sweden, Rebecka Soma.

3. The Finnish market is starting to pick up 

In 2018 we witnessed great demand for Virtual Data Rooms in all the Nordic markets – especially in Finland, where total Data Room sales more than doubled compared to 2017.

“The Admincontrol Virtual Data Room was introduced in Finland early 2017, so last year was the real launch. I noted that companies were keen to see a new solution, which resulted in hundreds of meetings in 2018. Throughout the year, increasingly more companies started using Virtual Data Rooms from Admincontrol, and they had a positive experience. Now we are starting to notice the benefits of word-of-mouth recommendations”, says Head of Virtual Data Rooms in Finland, Erik Alopaeus.

Alopaeus explains that a Virtual Data Room is becoming more “common” to use in the M&A process in Finland:

“I am confident that we will continue to see growth in 2019,” he says.

What`s in store for 2019?

We are backed by our owner Visma, which is investing heavily in R&D. Last year, we hired 10 new developers and we are ramping up our focus on the Data Room solution. It is incredibly exciting to be involved in this key initiative.

Our development pipeline comprises several new initiatives, all intended to streamline our users’ day-to-day operations. We are also working on strategic projects such as integration with leading Artificial Intelligence (AI) systems. Admincontrol has also responded to the increase in demand for Virtual Data Rooms by adding additional sales representatives in the various local markets such as Finland, Denmark, Sweden and the UK.

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