2014 has been the best year for M&A since the financial crisis, but we think 2015 could be even better. The market is flush with easy financing and cheap debt which has large companies looking to acquisitions for growth. Here are our top candidates to be bought out in this new year.
There's a perfect storm brewing in the M&A industry for 2015.
Growth prospects for certain industries are quickly declining due to increased competition, making acquisitions a quick and easy way to grow. And sellers are becoming more and more motivated in a variety of industries (most notably the oil and gas space).
With that in mind, let's take a look at what 2014 brought us and the companies that could be buyout targets in 2015.
M&A Buyouts For 2015 No. 1: media
The media industry has been a hotbed for M&A deals this year. And 2014 was a year of megadeals in media.
We have the pending $71 billion acquisition of Time Warner Cable (NYSE: TWC) by comcast (NASDAQ: CMCSA). AT&T (NYSE: T) is trying to spend over $67 billion to buy DirecTV (NYSE: DTV). And 21st Century Fox (NASDAQ: FOXA) even made a $80 billion play for Time Warner (NYSE: TWX), but that was ultimately abandoned.
Notice that the big trend in media M&A is focused on the TV industry. 2015 should bring even more TV M&A as competition forces companies to find new ways to save on costs and drive earnings growth.
Along those lines, will Starz (NASDAQ: STRZA) finally see a buyout? It's the only remaining independent premium pay-TV channel left. CBS Corp. (NYSE: CBS), owner of Showtime, has been a speculated buyer. And the move could give CBS a stronger hand in competing with Time Warner's HBO in the premium channel space.
Famed deal maker John Malone, who owns roughly 49% of Starz, has noted that the pay-TV channel would be much better off as part of a larger cable company. 21st Century Fox also recently met with Starz about a buyout or possible strategic alliance.