M&A market on fire in July, deals face a chill

Fundraising (volume down -11%)

Fundraising by venture firms dropped 11 percent to just over $3 billion in July, compared to more than $3.4 billion recorded in June. Of the more than 30 funds that closed during the month, one of the largest was Sofinnova Ventures, which closed its latest fund at $510 million. Similarly, Meritech Capital Partners closed its fifth fund at $500 million.

Deals (value down -20%)

The value of deals in July fell 20 percent to $4.7 billion, compared to the $5.9 billion during the previous month. Overall, there were 300 deals in July with the average equity per deal at $15.75 million. The largest deal to close over the month was the $1 billion investment in Flipkart Online Services Pvt Ltd, an online retailer, by Accel Partners, Gic Special Investments Pte Ltd, Morgan Stanley Alternative Investment Partners, Tiger Global Management LLC and two other undisclosed investors.

M&A (value up 254%)

A total of 45 venture-backed M&A deals were completed in July, resulting in an aggregate rank value, including net debt, of almost $5.3 billion for those with disclosed financial terms. Compared to June, when M&A deal activity was $1.5 billion, the market increased 254 percent for companies with a U.S.-based financial sponsor. The largest deal over the month to close was the acquisition of Oculus VR Inc by Facebook Inc for $2.18 billion in a cash and stock combination.

IPO (total proceeds down -27%)

The number of VC-backed IPOs increased to 13 in July, compared to nine in June. But the value of the newly public offerings fell from $1.1 billion to $824 million. The largest VC-backed IPO in July was from Avalanche Biotechnologies Inc, which raised $102 million. The developer of gene therapies for serious eye diseases was backed by Cowen Capital Partners LLC, Venrock Inc and others.

Compiled by Larry Oberfeld, based on Thomson Reuters data and original research.

Data is continuously updated and is therefore subject to change. Date based on U.S. venture firms. Photo illustrations by Janet Yuen.