"M&A is hard – you don’t test the edges very often," muses Robert Kindler, global head of M&A at Morgan Stanley. Verizon’s acquisition of Vodafone’s stake in its wireless business was in essence a straightforward concept: it was buying 45% of a business it already had a 55% stake in and knew everything about. But the scale of the undertaking meant that this deal very much tested the edges. "Some transactions will come out of this as a result," Kindler tells Euromoney. "There are a handful of very large deals that people now have confidence are doable."
The allocation of more than $100 billion to a single corporate bond deal certainly indicates that the market is in uncharted territory. "The implications of this deal are large – it has got everyone’s attention," says Keith Harman head of media and telecom debt capital markets at Bank of America Merrill Lynch. "The expectations of what is possible in terms of raising debt are much higher than they were before it was done. It is a watershed event. Some firms that viewed themselves as an acquirer before this deal might now be an acquiree," he concludes. "This changes the likelihood of additional big, transformational deals.
