Merger and acquisition activity sets record in Q2

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Swiss-based Xstrata's $19.2-billion takeover of Falconbridge topped the M&A list in the most recent quarter, followed closely by the $18.8-billion takeover bid for Inco from Teck Cominco.

Teck has since withdrawn that bid, but Inco remains a target as it faces takeover offers from U.S.-based Phelps Dodge and Brazil's CVRD.

"With the presence of domestic and foreign strategic and financial buyers, and the emergence of bidding wars, this market has it all,'' Crosbie managing director Ed Giacomelli said in a release.

Company transaction involvement up

Crosbie and Co., a Toronto-based investment bank, said Canadian companies were involved in 480 transactions in the quarter, up from 420 in the same period last year.

Eleven of the transactions were in the "mega-deal" category, which Crosbie and Co. defines as being worth more than $1 billion. There were six mega-deals in the same quarter a year ago and five in the first quarter of 2006.

While the metals and mining sectors were responsible for almost half of the value of all M&A activity, almost every sector saw more activity, the company said.

There were 116 transactions in the oil and gas sector worth $15.8 billion. Penn West Energy Trust's $3.1-billion acquisition of Petrofund Energy Trust topped that list.

During the first six months of 2006, cross-border transactions accounted for 71 per cent of the total value of all M&A transactions.

"This trend is highlighted by the strong interest by foreign acquirers in some of Canada's largest companies," Crosbie and Co. said.

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