Cayman leads the way for deal making


The Cayman Islands was the most used jurisdiction for offshore deal making in the first quarter of 2014, accounting for roughly a third of the total volume and value of deals that took place across offshore jurisdictions.

This is according to a report by Appleby, a provider of offshore legal, fiduciary and administration services. When compared to the first quarter of 2013, the number of Cayman-based deals increased by 19 percent and total deal value was up 66 percent.

Cayman attracted 164 deals in the first quarter with a cumulative value of $20.7 billion. The jurisdiction was well ahead of its nearest offshore comparators by volume of deals, including the British Virgin Islands which saw 107 deals and Bermuda which announced 96 deals during the period.

The report focused on transactions announced during the first quarter of 2014, a period in which total offshore deal value increased by a remarkable 79 percent across all jurisdictions when compared to the same period last year.

“First quarter deal value across jurisdictions was the highest it’s been since the end of 2012 and represents the fifth consecutive three-month period in which offshore M&A deal values have increased,” said Simon Raftopoulos, a Cayman-based partner and member of the firm’s corporate finance and insurance teams.

“There were 15 deals worth more than $1 billion in the quarter, which is the highest number we have seen, and the top five deals, two of which occurred in Cayman, were each worth in excess of $2 billion.”

In the first quarter of 2014, Cayman deals were valued at $2 billion more than those completed in fourth quarter of 2013, despite posting 30 fewer deals. When compared to the first quarter of 2013, the number of Cayman deals increased by 19 percent and total deal value was up 66 percent.

Among the quarter’s ten largest transactions was the announced $3 billion acquisition of Giant Interactive Group, the Chinese headquartered and Cayman-incorporated online games developer, by a group of investors that includes Baring Private Equity Partners Asia.

In total, there were 572 offshore deals in Q1 2014, down from the previous quarter but busier than the first quarter of 2013, which saw 528 deals.

Though there were fewer deals, deal value came in at $62.9 billion, up 14 percent on the previous quarter and marking the fifth consecutive quarter for cumulative deal value growth.

This quarter’s average deal size of $110 million is the highest in the past seven years, aside from the anomalous final quarter of 2012 when a single $56 billion transaction caused average deal values to spike.

The growth in average deal size is the clearest sign yet of a new depth to the market, as investors become ever-more willing to put money to work on larger transactions, the report found.

“The most significant conclusion to be drawn from the quarter’s figures is that we’ve turned a corner away from a difficult five years following the global financial crisis,” said Cameron Adderley, partner and global head of corporate & commercial.

“The number of deals in Q1 2014 was down compared to the previous quarter as expected, but total deal value and average deal size were up, setting the stage for a busy 2014.”

Cayman, Appleby, Simon Raftopoulos

Cayman Funds