The Cayman Islands recorded 31% of all offshore M&A transactions and 26% of total deal value in 2018, maintaining its title as the top jurisdiction for offshore deal making last year.
That's according to a report released today by offshore law firm Appleby. The latest edition of Offshore-i, an Appleby report that provides data and insight on merger and acquisition activity in the major offshore financial centres, focuses on transactions announced over the course of 2018.
In all offshore centers monitored by the latest Offshore-i report, overall deal value increased by more than $100bn to $344bn compared to 2017, in 2,781 deals targeting offshore companies.
Cayman continued to lead the way in overall M&A activity in 2018, driven in part by a particularly active technology sector"
"Cayman continued to lead the way in overall M&A activity in 2018, driven in part by a particularly active technology sector," said Simon Raftopoulos, partner and group head of Appleby's Private Equity practice in the Cayman Islands. "Despite a slight dip in the total number of deals, Cayman saw a rise in both overall deal value and average deal size."
The cumulative deal value involving Cayman reached $89.7bn last year as the jurisdiction saw three of the year's 10 largest offshore deals. With 867 deals, Cayman was the busiest offshore center for deal making, followed by Hong Kong (709 deals), the British Virgin Islands (504 deals) and Bermuda (307 deals).
Acquisitions have become increasingly popular over the last two years, compared to taking a minority stake in a company or releasing more shares to investors, and now make up nearly half of all offshore M&A activity.
"Investing companies are no longer content to just take a seat on the board, but want full control of an asset in order to gain a competitive advantage over rivals," said Cameron Adderley, Partner and Global Head of Corporate at Appleby. "This drive to do strategic deals is likely to continue, providing finance remains readily available, interest rate rises predictable and markets stable. Gaining access to transformational technologies also remains a big incentive across almost every sector."