Mergers acquisitions down 30 percent in 2008 as crisis hits
Posted by meb at January 8th, 2009
Turkey saw $18.4 billion in mergers and acquisitions (M&A) in 2008, with the 172 deals recorded for the year representing a 30 percent decline over 2007, a new report has indicated.
According to Deloitte Turkey’s annual M&A report, released yesterday, excluding privatizations, which rang in at about 38 percent ($7 billion) of the total volume, this number was 30 percent below the total for 2007. With the increasing force of the ongoing economic crisis, which picked up momentum in the last quarter of 2008, M&A activity in the last three months of the year was 60 percent below that of the previous year’s fourth quarter figures, the report noted.
The annual report, one of the most respected in the industry, explained that 75 percent ($13.8 billion) of the deals in 2008 were conducted by foreign investors. Leading the pack of foreign investors were Europeans, who contributed 81 deals, totaling $11.5 billion. US investors completed 10 deals, while investors from Gulf states completed nine. Sixty-four transactions were completed by Turkish investors, totaling approximately $4.6 billion. The list of significant Turkish investors involved in major M&A activity included Akkök, Alarko, Çalık, Çelebi, Kiler, Limak, Sabancı, Ülker and Zorlu.
One interesting finding in the report was that if the top five deals were excluded, unlike 2007, the majority took place in the mid-price range of $40 million. Including the top five deals, the average deal was about $105 million.
The report also indicated that the financial sector, despite the credit crunch, contributed 32 deals, accounting for approximately 35 percent ($6.5 billion) of total transactions. This figure was said to be higher than the total amount contributed by the sector for both 2006 and 2007 combined.
Significant deals for the year included the largest-ever Turkish leveraged buyout of Migros by BC Partners-DeA-Turkven for $3.1 billion, as well as the 100 percent $1.72 billion acquisition of Turkey’s alcohol and tobacco monopoly’s (Tekel) tobacco unit by British American Tobacco (BAT). Also making the top-five list were the Global Yatırım Holding-Energaz-ABN Amro 100 percent acquisition of Baþkent Doğalgaz for $1.61 billion, the 100 percent acquisition by EnerjiSA-Verbund of Ankara’s electricity distribution company Baþkent for $1.225 billion and the National Bank of Greece’s 9.7 percent acquisition of Finansbank for $697.2 billion.
source: Today’s Zaman
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