NYSE-owner ICE says COVID-19 has complicated the M&A picture

Reuters

Published Jul 30, 2020 12:30PM ET

By John McCrank

NEW YORK (Reuters) - The COVID-19 pandemic has complicated merger and acquisition deal making, as social-distancing and restrictions on travel have made it harder for top executives to meet face-to-face, the head of Intercontinental Exchange Inc (N:ICE) said on Thursday.

"The COVID-19 environment has really created winners and losers in many spaces, including financial services," ICE CEO Jeffrey Sprecher said. "We've had a lot of inquiries from fintech-type companies that are worried about their future funding capabilities."

ICE, which bought the New York Stock Exchange in 2013, has grown from a small energy-trading business in 2000 to one of the world's biggest exchange operators, with a $51.6 billion market cap, largely through acquisitions.

The most recent high-profile deal it explored was a more than $30 billion takeover of online marketplace eBay Inc (O:EBAY) that ICE abandoned in February following investor backlash.

Since then, the coronavirus pandemic has quickly spread, leading to lockdowns around the world, forcing work-from-home mandates and limiting in-person meetings.

Those measures have made it harder for chief executive officers to meet, get to know each other, and determine if their businesses would be a good fit, Sprecher said on a call with analysts.

"We're in a great position if the right thing were to come along, but it's a complicated environment for M&A just due to the social distancing that's going on," he said.

The one area where there has been a pickup in M&A activity has been with smaller private equity-owned firms that are looking to sell themselves to larger companies with deep pockets, he said.