Posted by meb at January 17th, 2013

Turkey saw a record number of mergers and acquisitions (M&As) in 2012, an indication that 2013 may be a strong year for foreign and domestic investment, global consultation and auditing firm Ernst & Young told journalists gathered at a press breakfast on Wednesday.
The country saw 184 M&As by Turkish firms and 131 by foreign firms last year, with a total public value of around $23.2 billion. Clients often request to keep the value of their deals confidential, and the total value of M&As in Turkey last year might in fact be around $30 billion, Ernst & Young officials stated.

“The $23.2 billion in public deals compares favorably with the dismal $3.9 billion M&As seen in 2009 or the $11.5 billion in 2011,” said Ernst & Young corporate finance manager Müşfik Cantekinler, who argued that the numbers revealed that “investor confidence in the Turkish market has now returned to pre-crisis levels.”

And while the total value of those deals is back where it was four years ago, the absolute number of M&As in 2012 was 50 to 75 percent higher that the number seen in the three high-growth years before the crisis. “It shows an impressive growth in activity. Though the size of the deals may be smaller, more companies in Turkey show growing ambition and there is more interest in Turkey from investors abroad,” said Cantekinler.

Growing investments may seem like a foregone conclusion as Turkey basks in its upgrade from ratings agency Fitch late last year, a well-performing stock market and surging exports figures. But while that gives investors an alternative to the gloomy outlook elsewhere in Europe, “Our positive assessment is driven by some strong internal indicators, more than just a negative investment climate elsewhere,” said Cantekinler. “In energy, infrastructure and industry there are plenty of chances for a serious level of expansion.”

The energy industry saw just under $7 billion in M&As last year, while the transportation and financial services sector saw $6.9 billion and $4.3 billion, respectively. “There has also been investment activity in consumer sectors, especially food and drinks,” said Cantekinler, who said the target of much investment has been profiting on domestic consumption, which has soared in the last decade.