2016's fallen giants of the stockmarket

This year has been a rotten one for the mortality of well-known people, and although Brexit's economic uncertainty has stifled UK takeover activity, some pretty big names have still vanished from the London stockmarket.

Britain just avoided a collapse in mergers and acquisitions this year, thanks to a last minute flurry of deals as international buyers scooped up bargains devalued by sterling's slump against the dollar. Domestic deals fell to 1,355, the lowest level for two decades.

UK M&A transactions totalled $177.5 billion (£144 billion) in 2016, less than half the $394.8 billion record achieved last year, Thomson Reuters data shows. Although weak against last year, the performance has actually drifted back to the longer five-year trend, after the 2015 data was skewed by three mega deals.

Still holding tightly onto bronze medal, the UK stands below the America and China. Global M&A was worth $3.6 trillion this year, down 17% from last year's $4.37 trillion record.

What will 2017 bring?

While 2016 has seen a return to a steady stream of takeover activity, with so much political uncertainty ahead, what will 2017 bring? President elect Donald Trump will take his seat in the Oval Office on 20 January and British Prime Minister Theresa May has promised to trigger Article 50 by the end of March.

With companies keen to support higher valuations in case equity markets get nervous, M&A appetite will underpin an uptick in activity in the first half of 2017, reckons accountancy firm EY.

Rupert Murdoch's bid for Sky could ring the bell in, after the pair agreed on an offer worth £10.75 per share in December, minus any dividend paid in the meantime. Fox already owns 39% of Sky and this the media mogul's second attempt at the takeover.

The pair are still working out the small print and it needs to get the nod from Sky's shareholders, but most think the writing is on the wall. We will know more on 7 January.

The New Year is a time for reflection as much as looking forward - if you do want to make the most of 2017, visit our Hub.

We have taken a look at three of the companies we've said goodbye to this year.

BG

Hurt by dirt cheap oil prices, petroleum giant Shell's £40 billion takeover of BG kicked off the year. Shell is already reaping the benefits of the acquisition, enjoying the fruits of its attractive portfolio mix of deepwater, tight oil and liquified natural gas (LNG) assets.

Investors were given 0.4454 of Shell B shares for each BG stock they held, and should now be looking forward to getting the most of the new 15-year resource base, which represents $70 billion (£55.6 billion) of investment potential offering 20% return.

SAB Miller

Now the largest brewery, Belgium-based Stella Artois maker Anheuser-Busch InBev got the go-ahead from investors for their £45 per share takeover of SAB Miller, after a year of discussions.

Sterling's post-Brexit plunge meant AB Inbev was forced to raise its offer, although Aberdeen Asset Management still accused this of being "unacceptable" as it "significantly undervalued SAB Miller".

The deal valued SAB at around £79 billion, up from £70 billion. Still, enough were clearly behind the deal to give it the green light and two of the UK's most influential advisory groups also backed the takeover.

ARM Holdings

Investors who stuck with Cambridge-based chip designer ARM Holdings from its 1998 float to this year would have been laughing all the way to the bank after Japan's Softbank coughed up £24.3 billion for the firm - £17 a share.

Regularly the subject of takeover speculation, ARM was the UK's largest tech company. It has outperformed following the EU referendum, but had lost its knock-out edge over the last 18 months and trading had been volatile over the last three years.

Investors were nervous that deal-making in the chip sector would mean fewer customers, licences and potential royalties.

This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.