Turkish Outbound M&A Review 2016

Despite elevated political tension in domestic and neighbouring markets as well as depreciating lira, their appetite to become regional and global players via cross-border acquisitions was enduring in 2016 through 42 deals. Accordingly, the outbound deal volume of Turkish investors in the last decade totaled to US$26.3 billion through 292 transactions.

In 2016, Turkish dealmakers’ outbound M&A activity was around c. US$2.3 billion through 42 deals (including estimates for transactions with undisclosed values). While the deal number remained largely flat compared to recent years, the deal volume was at the lowest level in the last five years. Remarkably, the largest deal was the acquisition of Puerto Bolivar Harbor by Yılport Holding with a deal value of US$750 million, which represented c. 33% of the overall annual volume.

Similar to previous years, we observed Turkish companies engaging in cross border acquisitions with the motives of market diversification, global footprint, brand acquisition and raising competitive advantage through cost efficiencies.

While mid-sized deals drove the total deal number, Doğuş Group, Global Liman İşletmeleri, Yıldırım Holding and MNG Holding through acquisitions in restaurants & hospitality, infrastructure, and mining, maintained their pattern of regular acquisitions over the last years and together hosted almost half of the total number of outbound deals. Venture capital and angel investor deals were on the list as well through a few investments in internet & mobile services and technology.

Predominantly, Euro-zone once again was the most favourite investment destination

for Turkish investors, representing c. 76% of the total deal number, followed by countries in North America and Africa.

Infrastructure, restaurants & hospitality and manufacturing were the top three sectors both in terms of deal value and deal number, and together hosted 83% and 52% of the total annual deal volume and the total deal number, respectively.

Overview 

While we expect 2017 to be a sluggish year in terms of outbound M&A activity due to

the diminishing profitability coupled with lesser availability of funds, still Turkish investors would continue to pursue both opportunistic and strategic investments abroad.