About 42% of Big Mergers Found to Leak Before Being Announced

(Bloomberg) -- Even in the cloak and dagger world of mega mergers, some secrets are too hard to keep.

That's according to a report from strategic communications firm Abernathy MacGregor, which found that 42% transactions worth at least $5 billion were leaked before announcing.

“This number would be even higher if we included deals that were speculated about publicly but apparently fell apart,” Abernathy MacGregor said. “Big deals leak a lot.”

The report -- a marketing document called “When Deals Spring a Leak” -- looked at 189 takeovers from 2015 to 2018 that involved at least one party from the U.S. On average, deals leaked 11 days before announcing, it found.

Deals generate a lot of press, whether or not they leak.

Transaction announcements led to a whopping 552% jump in media interest in target companies and a 292% increase for buyers, Abernathy MacGregor found.

This was even true for Amazon.com Inc., a company that is regularly in the news. There were more than 9,000 articles about the company in June 2017, when it agreed to buy Whole Foods Market Inc. for about $13.7 billion. That was a 44% increase in press from the month before.

“A deal is likely the highest profile news event of the year for any company, and creates an extraordinary moment of attention,” the report said.

Abernathy MacGregor, a division of Havas SA, helps advise companies on merger announcements and other strategic matters. The firm worked for SunTrust Banks Inc. on its agreement in February to be bought by BB&T Corp. for $28 billion.

Other deals the firm has worked on include T-Mobile U.S. Inc.'s pending $26.5 billion transaction for Sprint Corp. and the $14.9 billion merger of Dr. Pepper Snapple Group Inc. and Keurig Green Mountain Inc. in 2018.

To contact the reporter on this story: Nabila Ahmed in New York at nahmed54@bloomberg.net

To contact the editors responsible for this story: Liana Baker at lbaker75@bloomberg.net, Matthew Monks, Michael Hytha

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