M&A transactions in Turkey fall 58% in first half
Global accounting firm EY has announced the June 2017 results of its M&A Barometer report covering 11 Central and Southeast European countries. According to the report results, there were 56 mergers and acquisitions worth $3.6 billion in Turkey in the first half of 2017, placing the country fourth in terms of transaction volume and second in for transaction value. During the same January-June period last year, 133 transactions amounted to $3.5 billion in Turkey. The number of transactions this year indicates a 58% drop compared with the previous year.
The purchase of OMV Petrol Ofisi by Vitol Investment was the biggest single transaction in the region during the period examined. Emphasizing the importance of Turkey in terms of mergers and acquisitions in the region, Musfik Cantekinler, head of EY’s corporate finance department, said: “Although the uncertainties in our region continue and these developments affect the mergers and acquisitions in Turkey, we think domestic and foreign investors will continue their interest in Turkey. The biggest transaction taking place in Turkey in the first six months in two consecutive years in a list like that is such an important development.”
Increased transact on volume, decreased numbers
According to the report, Turkey, which ranked second for both transaction volume and transaction value in the first half of 2016, was beaten to the top spot for transaction value by the Czech Republic and for transaction volume by Czech Republic, Poland and Hungary over the same period of 2017. Turkey’s 655 M&A transactions from January-June 2016 declined to 473 – a 47% drop – in the corresponding period in 2017. The estimated size of the transactions realized in the first half of the year in the region is $19.9 billion, which represents a 42% increase year-on-year.
Evaluating the results of the M&A Barometer for the first half of 2017, Cantekinler said Turkey is still an interesting country for investors despite the ongoing political and economic tension in Turkey and its wider region during the time period assessed. In addition, Cem Gunfer, the senior manager of EY’s corporate finance department, said that despite the decrease in transaction numbers in 2017, the limited increase in transaction volume was due to the effects of large volume transactions. He said Turkey had a high potential in terms of mergers and acquisitions, that the number of transactions in the first half of the year could rise in the second half of the year and that EY expects a more favorable environment in 2018.