Which market sectors have been particularly active recently?

Mergers & Acquisitions (2nd edition)

Hong Kong Small Flag Hong Kong

The real estate and property sectors as well as insurance sectors continue to dominate. Outside of these sectors, finance, construction/building, computers and electronics, and professional services are also significant sectors.

Austria Small Flag Austria

According to the Ernst & Young M&A market analysis for 2017, the highest transaction values in the year 2017 were achieved in the real estate and the technology sector. With 86 transactions completed, real estate was again the most active market, followed by 76 transactions in technology and 60 in industry.

The majority of transactions in 2017 were strategic transactions. Only 20 deals were completed by financial investors.

United Kingdom Small Flag United Kingdom

The financial services and consumer discretionary sectors were the most active in 2017, followed by real estate, industrials and information technology. Healthcare, materials and the energy sectors were also active but not to the same level as the financial services, consumer discretionary, real estate, industrials and IT sectors.

Bulgaria Small Flag Bulgaria

Traditionally strong sectors, such as commercial real estate, which have stagnated significantly after the 2008 global financial crisis, have experienced substantial and increasing activity. At the same time, younger sectors, such as IT, have grown exponentially.

In terms of deal value, the commercial real estate sector is dominating the overall M&A market. The highest value deal amounted to nearly EUR 253 million, involving a shopping mall acquisition and a total sector deals value of nearly EUR 800 million. A large proportion of the announced deals being made in acquisition of shopping centres, office buildings, and other commercial real estate. A trend of reorganizations is also felt throughout the real estate sector, as significant distressed corporates are moving to be refinanced by private equity funds and new investors.

A significant merger in the financial sector have been made, with a reported deal value of more than EUR 600 million, where one of the biggest banks in Bulgaria was merged with another bank, forming a new institution, which should be able to rival the third biggest bank in terms of assets. Consolidations between the banks are expected to keep an active financial sector. The leasing sector was particularly active with sales of several leasing companies, while the insurance sector is in the focus after the local balance sheet review exercise. Significant growth is registered in the IT sector, where local companies, have reached some great potential bringing foreign investment interest. The sector has boasted the largest numbers in terms of volume of transactions, although values remain relatively low for now.

The largest bottled water producer in Bulgaria was also acquired by a strategic foreign investor for a reported EUR 120 million. In the same sector, the purchase of the exclusive Pepsi beverages and Prisun juices producer and distributor by a leading water and beverage player. British American Tabaco acquired the most popular local cigarettes brands for the country for a price of EUR 100 million.

The TMT sector has also been active with deals for some of the largest cable operators, telephone operators and national networks in the past years.

The purchase of one of the leading car distributors in Bulgaria through a competitive tender could be also distinguished as one of the largest and substantial for the sector and the market as a whole.

Colombia Small Flag Colombia

During the past years, the market sector with most deals has been the financial and insurance sector. Recently, the distribution and retail sector also had an important activity, as well as the infrastructure (roads and highways), telecommunications and energy (power and generation plants) sectors. We have recently seen increasing interest in the health industry.

In our opinion the market of acquisition finance will support the M&A activity in the coming years considering that the existing legal framework does not restrict this activity as it happened in the past.

France Small Flag France

Activity has been buoyant in all sectors, from real estate to luxury, through distribution and industry. Nevertheless, this upswing has been driven in particular by finance and consumer goods, but also by industry and insurance, which are experiencing a marked upturn in activity. France also benefits from a nursery of young innovative companies, especially in the area of new technology that gives momentum the small cap deals market.

New Zealand Small Flag New Zealand

Sectors which have been particularly active over the last 12-24 months include:

  • the private equity market which has resulted in an increase in the volume of transactions as existing funds have sought to deploy newly raised capital (e.g. Quadrant and PEP) and recently established funds (e.g. Adamantum) made their initial investments in New Zealand,

and from an industry sector perspective:

  • the food and beverage sector has continued to be an active sector – with significant transactions being the acquisitions of, or investments in, Mainland Poultry, Leader Foods and My Food Bag;
  • the last 24 months saw increased activity in the healthcare sector, ranging from aged care (Heritage Lifecare and Geneva Healthcare) and general practice (Nirvana Health) to healthcare technology (Healthlink) and supplements (GoHealthy); and
  • the financial services market continues to be particularly active as the large trading banks began a programme of divesting non-core business units (e.g. UDC).

Egypt Small Flag Egypt

Renewable energy sector and consumer focused sectors such as food and beverage, healthcare and education.

Cayman Islands Small Flag Cayman Islands

The technology, media and telecommunications, real estate and healthcare sectors continue to dominate deal flow. Buyers are also keeping a watchful eye on the nascent fintech industry.

Italy Small Flag Italy

The industrial products and services sector has been the most dynamic one in 2017, with the highest number of deals. The consumer retail sector was the first one for the total value of deals completed.

Financial services and energy sectors have also been quite active in 2017, in terms of both number and value of deals completed. The pharmaceutical sector, instead, has experienced a contraction compared to 2016.

Infrastructure sector has been rather active as well.

Lastly, in 2017 the number of IPOs has increased. Up to October, 19 companies decided to go public. Besides the success of the Alternative Investment Market, the positive result is to be ascribed to the rise of SPACs.

Ireland Small Flag Ireland

The food and healthcare/pharmaceuticals sectors have been most active in terms of public M&A activity in the past year where we have seen a number of significant acquisitions by foreign acquirers while the technology, agri-food and healthcare/pharmaceuticals sectors have been particularly active recently in terms of general M&A activity in Ireland.

Brazil Small Flag Brazil

Infrastructure is, by far, the sector where most of the activity is happening because of the combination of several different factors. The car wash corruption scandal (which affected most - if not all - the major Brazilian infrastructure conglomerates) dried the debt and equity capital markets for those involved in a time where the backlog of projects - and hence funding - was huge. That forced the market to turn to the next best way to access funding - M&A.

The hospital industry is also worth noticing as a safe bet. The recent lifting of the restrictions to foreign investors in equity is attracting foreigners to implement acquisitions in the country. Other industries that had also noted an intense M&A activity are the following: insurance, ports and education industries.

Cyprus Small Flag Cyprus

Although most market sectors are showing signs of growth over the last year, the private equity market in Cyprus and the business services, banking and financial services as well as energy and tourism sectors are all showing significant growth rates.

Norway Small Flag Norway

Entering 2018, industrials, TMT, consumer and retain, business services and the energy sectors have all shown the strongest momentum in the Norwegian M&A market.

Myanmar Small Flag Myanmar

Dica statistics show that foreign investment has been particularly strong recently in manufacturing, real estate development and transport and communications, and historically it has been strong in oil and gas.

The government is in the process of developing tenders for the upgrade of its aged infrastructure, including road, rail and port infrastructure, and this is likely to drive further investment.

MIC for example, issued an announcement on 22 December 2017 calling for applications under the MIL to invest in the manufacture of certain products to substitute imports, such as vehicles and vehicle parts, tractors and trailers, telecommunications equipment, and machinery and inputs such as iron and steel. It announced on 26 December 2017 that it was seeking applications under the MIL to invest in certain logistics services in major cities and logistics hubs, such as dry port services, bonded warehouse services and highway bus and freight terminals.

The banking and insurance sectors are also generating interest from foreign investors. No foreign insurer has been awarded a licence to date under the Insurance Business Law of 1996 to undertake an insurance business in Myanmar (they may only conduct such a business in partnership with Myanma Insurance, the state-owned insurer, or in special economic zones under Notification 2/2017 of the Insurance Business Regulatory Board of Myanmar). However, on 24 August 2017, the Ministry of Planning and Finance (MOPF) issued Notification No 87/2017 establishing a board to review and select foreign insurance companies for licensing.

Similarly, banking businesses are regulated by the Central Bank of Myanmar (CBM) under the 2016 Financial Institutions Law (FIL). Under the FIL, a foreign bank may only sell its business or acquire a local bank’s business (or a substantial part of either) with the approval of CBM. In addition, prior CBM approval is required for the (direct or indirect) acquisition of a ‘substantial interest’ in a bank (defined as 10 per cent or more of the shares in, or the capacity to control the management of, a bank). No approval has been provided to date for such acquisitions.

Instead, foreign banks are currently permitted to offer corporate and wholesale banking services to foreign-owned companies and Myanmar banks after establishing a branch in Myanmar with a licence from CBM. Thirteen foreign banks have established branches in Myanmar to date. CBM officials have in the past indicated that it is considering options to liberalise restrictions on foreign banks, and on 8 December 2017, it issued Directive No. 9/2017 permitting foreign banks to provide export financing to local export businesses with its prior approval.

Greece Small Flag Greece

Over the last years the energy, hotel, food, fish, cosmetics, metallurgy, IT, telecoms, insurance and retail sectors have been active. One of the most important transactions of the last two years is the ownership unbundling of the Hellenic Electricity Transmission Operator (ADMIE) in a triple transaction where PPC sold 24% to the Chinese grid company State Grid, 25% to a publicly owned SPV and transferred 51% to its own shareholders through a capital reduction via the Athens Stock Exchange.

A further major transaction still pending is the sale of 67% of the Thessaloniki Port Authority shares to the joint venture of Deutsche Invest Equity Partners GmbH, with its subsidiaries CMA CGM Terminal Link SAS and Belterra Investments LTD having committed to invest 180m euros in the port of Thessaloniki. A part of the Pireaus port had preceded with the Chinese Cosco acquiring 67% of the Piraeus Port Corporation’s share capital.

Other major transactions completed over 2016-2017 include the acquisition by Sklavenitis (the company owning the largest chain of Greek supermarkets) of the insolvent Marinopoulos SA supermarkets, through an agreement for the restructuring of the latter; a large insurance sector merger with ERGO Hellas absorbing the formerly state owned ATE, and the acquisition of the Greek company Taxibeat by the German Daimler-Benz group.

Germany Small Flag Germany

According to statistics from MergerMarket, with Brexit discussions in full swing and despite the uncertainty caused by the German federal election, there was a healthy appetite for German assets in 2017. The industrial and chemicals sector remained robust throughout the first three quarters of the year, topping the charts with 188 deals reaching nearly EUR 60bn. Most notably are the Praxair-Linde merger, which accounted for most part of total deal value, followed by Deere & Company’s acquisition of Wirtgen.

The TMT sector maintained its runner-up position in terms of deal volume with 114 deals, exceeding a total deal value of EUR 5bn. Sector activity is supported by the state-backed Industry 4.0 initiative, aiming to establish the manufacturing sector at the forefront of automation and digital innovation. Business services remained the third most active sector in Germany with 75 deals totaling c. EUR 1bn in deal value.

Vietnam Small Flag Vietnam

3.1 M&A activity during 2017 was strong and vibrant across a broad spectrum of industry sectors.

3.2 Perennially strong sectors such as pharmaceuticals, manufacturing, real estate, FMCG, and general wholesale and retail distribution across many product categories continued to surge ahead, building upon the momentum having gathered in recent years. 2018 and 2019 are also expected to see continued expansion of M&A activity in these key established sectors.

3.3 Of particular note is the strong growth which was seen in M&A activity in 2017 in the technology space. Foreign investor interest in the technology sector surged markedly during 2017, with acquisition activity having been very positive in the areas of e-commerce and fintech in particular. The M&A transaction pipeline in these emerging technology sectors for 2018 and 2019 looks to be very positive, as Vietnamese consumers become more comfortable with transacting electronically and foreign investors move in to exploit the resulting rapid market expansion.

Belgium Small Flag Belgium

The pharma, media, IT and chemical sectors were particularly active and that will continue in 2018.

Switzerland Small Flag Switzerland

In 2017, the industrial (e.g. ABB/General Electric Industrial Solutions), pharma/life sciences (e.g. Johnson & Johnson/Actelion) and consumer sectors (e.g. Breitling/CVC, HNA/Dufry) have been particularly busy. In addition, 2017 produced numerous transactions in the banking and FinTech space, with numerous investments in startups in the tech and FinTech sector by established financial players. Private equity investors have been particularly active, recording the highest number of PE-related M&A transactions since 2007.

Russia Small Flag Russia

By value of transactions during January-November 2017, fuel and energy industry represented around 40% of the entire volume of the market and the service and retail sector – around 30%.

Romania Small Flag Romania

From what we have seen so far the financial markets, agriculture, industrial goods and retail sectors seem to be particularly active.

Qatar Small Flag Qatar

The government sector remains the most active sector in Qatar based on the hydrocarbons industry and major infrastructure projects.

United States Small Flag United States

Technology tops the list as the most active M&A industry in 2017. This trend is driven in part by the announcement of a number of megadeals (i.e., deals over $10 billion in value), but the proliferation of digital technologies into industries outside of the traditional technology sector resulted in a year of rather interesting business combinations (e.g., Amazon’s $14 billion acquisition of Whole Foods).

Financial services joined technology atop the list of the industries with the most sought-after targets in 2017. The total equity value of U.S. public targets announced topped $120 billion for both sectors.

Sweden Small Flag Sweden

With respect to M&A activity there has been significant activity in nearly all market sectors when it comes to target companies. On the buyer side, there has been significant activity from venture capital, private equity sponsors as well as industrial buyers. There is also a fairly even mix between Swedish and international buyers.

The sectors with the most listings during 2017 were healthcare, technology and industrials.

Philippines Small Flag Philippines

Traditional sectors like power and energy continue to have robust M&A activities. Over the past year, we have seen increased M&A activity in: financial technology, logistics and healthcare industries.

Guernsey Small Flag Guernsey

The top 5 target sectors by volume in 2017 were financial and insurance activities, manufacturing, information and communication, construction and mining and quarrying. Within Guernsey financial services the fiduciary and fund administration sectors have been particularly active in recent years, and there has been and continues to be significant restructuring of banks.

Japan Small Flag Japan

In the Japanese domestic market, investments in venture companies have increased. There has also been an increase in consolidations of Japanese regional banks, which is a recent phenomenon partly resulting from pressure by regulators.

Outbound transactions have taken place across a wide range of industries, in particular, healthcare, financial services, retail and consumer products sectors.

Isle of Man Small Flag Isle of Man

There has been recent activity within the financial services sector with a number of publicly traded Isle of Man companies by way of scheme of arrangement acquisitions of fiduciary businesses’, takeovers involving life assurance companies and significant restructuring of banks in the Isle of Man.

Mauritius Small Flag Mauritius

Recently there have been some changes within the financial services sector with considerable private equity investment into fiduciary businesses and mergers between insurance companies, constructions companies and financial service providers. Furthermore, applications for sandbox licenses that capture bitcoins and cryptocurrencies have begun to feature on the market.

Bermuda Small Flag Bermuda

The (re)insurance sector has been particularly active over the past two years. This was largely a result of insurance groups seeking to consolidate but targets have been acquired by parties looking for a way in which to access Bermuda’s (re)insurance market by gaining control of an established brand.

British Virgin Islands Small Flag British Virgin Islands

In 2016 – 2017 the most active sectors included natural resources, IT, media and telecoms. Significant deals included the acquisition by the Virgin Group, owned by Sir Richard Branson, of a majority interest in BMR Energy, a renewable energy group with operations throughout the Caribbean and Latin America, from American Capital; the acquisition by MegaFon of a controlling stake in Mail.Ru Group (one of Russia’s largest internet and social media groups); the acquisition by The North West Company Inc of Road Town Wholesale Trading Ltd (a BVI-based retail and wholesale conglomerate); and Unilever’s acquisition of eight BVI subsidiaries from the Latin American personal and home care giant Quala Inc.

Jersey Small Flag Jersey

The top 5 target sectors by volume in 2017 were financial and insurance activities, manufacturing, information and communication, construction, and wholesale and retail trade. In the local market, the trend of consolidation in the fiduciary and corporate services sector has continued. Software development also continues to attract significant acquisitions.

Turkey Small Flag Turkey

The most active sectors have been energy, financial services, transportation, internet, and real estate. While foreign investor interest was largely focused on the internet and financial services, primarily domestic investors fueled investments in energy and real estate. Due to increasing energy demand in Turkey, there were sizeable acquisitions and privatizations in the energy sector, the most significant of which was the Vitol Investment acquisition of OMV Petrol Ofisi A.Ş.. The IFM Investors acquisition of Mersin Port, and the BBVA acquisition of Garanti Bank were also notable deals of the year.

Nigeria Small Flag Nigeria

Insurance, Pension, Healthcare, and FMCG.

Hungary Small Flag Hungary

In 2017, Real Estate was the most active sector on the M&A market, with 27 closed transactions. Significant deals were also made in Food and Beverages, Services, and Telecom&Media.

Updated: November 13, 2018