It was almost inevitable.
After a blistering June that saw announced deals hit $20 billion in the Los Angeles area thanks largely to one mega television industry sale local mergers and acquisitions plunged in July to just $4.7 billion, according to data compiled for the Business Journal by Goldsmith Agio Helms, a Minneapolis-based investment.
The slowdown came amid the peak summer vacation season when activity on Wall Street normally slows, though local investment bankers cautioned about reading too much into the monthly numbers.
“We continue to see incredible strength and a very high level of deal flow in Los Angeles and Southern California in general,” said Greg Range, managing director of the Los Angeles office of Duff & Phelps LLC.
Indeed, if it were not for the $13.7 billion sale of Univision Communications Inc. in June, M & A; activity would have been off by far less in July, which saw 81 announced deals just three fewer than the preceding month.
The bottom line: with private equity funds still with more than $100 billion in their pockets, it’s unlikely M & A; activity will see a sustained slowdown anytime soon.
The single largest deal in July saw Los Angeles private equity firm Leonard Green & Partners LP team up with Texas Pacific Group to acquire San Diego-based pet food and supplier retailer Petco Animal Supplies Inc. for $1.8 billion.
Among other deals in July many were in industry sectors particularly strong in Los Angeles. In banking, Los Angeles-based Cathay General Bancorp. spent $23.5 million to acquired New Asia Bancorp Inc., a holding company for an Illinois-chartered bank.
With international trade continuing to expand, the month also saw deals among freight forwarders. UTi Worldwide Inc. in two separate transactions bought two Israeli firms, including Transclal Trade Ltd., for $19.8 million.
And with the price of gas likely to remain high, Thousand Oaks-based USA Petroleum Corp. sold 122 gas stations to San Ramon oil giant Chevron Corp. The deal strengthens the control refiners have over gasoline sales.
The entertainment industry saw one big deal. The nation’s largest promoter, Live Nation Inc., paid $350 million to acquire competitor House of Blues Entertainment Inc. Both companies are in Los Angeles.
