Analysis

Annual Turkish M&A Review 2018

Strategic investors were at the forefront of M&A activities in a challenging year

While 2018 was a turbulent year due to a number of economic and political challenges, Turkish M&A market demonstrated a better performance in terms of deal volume compared to the previous two years. Out of 256 deals, 115 had a disclosed value adding up to c. US9.2 billion. Considering the estimated value of deals with undisclosed values, total M&A volume was around c. US$12.0 billion in 2018, representing an increase of 17% y-o-y (2017 – US$10.3 billion via 295 deals) owing to the material contribution of a handful of big ticket transactions, especially by foreign strategic investors. While total number of deals contracted by 13% y-o-y, overall deal number was driven by numerous small and middle market transactions, including a significant number of early-stage M&A which represented 32% of the total annual deal number (82 out 256 deals).

The share of foreign investors in the total annual deal number was again modest at 29% with 74 transactions, broadly similar to the previous year (2017 – 70 deals), but those investors played a dominant role in the total deal volume by making up 63% of the total annual deal value, highest contribution since 2015. Total annual deal volume of foreign investors was c. US$7.6 billion (including estimates for undisclosed values), doubling the level in 2016 and representing a y-o-y growth of 38% mainly due to a couple of sizeable deals (2017 – c. US$5.5 billion). On the other hand, Turkish investors were involved in 182 deals (71% of total annual deal number) with a total deal value of c. US$4.4 billion (including estimates for disclosed values), representing 37% of the total annual deal volume (2017 – US$4.8 billion). While their deal number decreased by 19% y-o-y, their deal volume remained fairly similar to the previous couple of years.

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