Mergers to pick up in 2010
Güncelleme Tarihi:
Hurriyet Daily News
Oluşturulma Tarihi: Aralık 17, 2008 00:00
ISTANBUL - Mergers and acquisitions activity in Turkey, which has slowed down notably due to the global financial crisis, is likely to pick up again in 12 months’ time, Memduh Özargun, senior partner and head of advisory at KPMG, said yesterday.
"Our expectation is that 2009 will be a slow year in terms of mergers and acquisitions, but after that activity will return to the pre-crisis level," Özargun told reporters in Istanbul.
Mergers and acquisitions activity in Turkey is expected to total approximately $15 to $16 billion, a clear decrease from last year’s $20 billion. On the other hand, although the crisis has reduced mergers between Turkish firms, several foreign players continue to look for acquisition targets in Turkey, Özargun said.
"Transaction volume is slowing down but there still are some foreign players interested in Turkey. The sectors likely to be the most attractive for mergers and acquisitions in 2009 are retail, financial services and chemicals. Energy is also becoming increasingly important and there are Middle Eastern investors currently looking at the food sector," Özargun said.
Privatizations are also expected to bring renewed activity in the market over 2009. Upcoming privatizations include the national lottery, Milli Piyango, in the first half of 2009 and the operational bodies of the highways and intercontinental bridges of Istanbul in the second half of next year, Özargun added.
New commercial code
In order to attract more private equity investors to Turkey it is important the new commercial code is adopted soon, said İsmail Gökhan Esin, partner at EsinIsmen, a corporate law consultancy. Turkish small- and medium- sized firms, on the other hand, need to improve their understanding of the commercial code, such as reporting practices, if they are to attract foreign investors, Esin added.
"If a firm has three different accounts and if it claims to have a turnover of $100 million instead of $10 million, it simply cannot attract foreign investment. Small- and medium- size enterprises, or SMEs, could have major issues due to organizational aspects, but SMEs that are properly managed will fare well," he said.
Mergers and acquisitions activity in Turkey is expected to total approximately $15 to $16 billion, a clear decrease from last year’s $20 billion. On the other hand, although the crisis has reduced mergers between Turkish firms, several foreign players continue to look for acquisition targets in Turkey, Özargun said.
"Transaction volume is slowing down but there still are some foreign players interested in Turkey. The sectors likely to be the most attractive for mergers and acquisitions in 2009 are retail, financial services and chemicals. Energy is also becoming increasingly important and there are Middle Eastern investors currently looking at the food sector," Özargun said.
Privatizations are also expected to bring renewed activity in the market over 2009. Upcoming privatizations include the national lottery, Milli Piyango, in the first half of 2009 and the operational bodies of the highways and intercontinental bridges of Istanbul in the second half of next year, Özargun added.
New commercial code
In order to attract more private equity investors to Turkey it is important the new commercial code is adopted soon, said İsmail Gökhan Esin, partner at EsinIsmen, a corporate law consultancy. Turkish small- and medium- sized firms, on the other hand, need to improve their understanding of the commercial code, such as reporting practices, if they are to attract foreign investors, Esin added.
"If a firm has three different accounts and if it claims to have a turnover of $100 million instead of $10 million, it simply cannot attract foreign investment. Small- and medium- size enterprises, or SMEs, could have major issues due to organizational aspects, but SMEs that are properly managed will fare well," he said.