Sunil Bharti Mittal, the billionaire chairman of Indian telco Bharti Airtel, was pretty keen to get his hands on the African operations of Kuwait-based Zain after two previous failed attempts to buy South Africa’s MTN. Flying into Kuwait in February this year, Mittal meant business. This time, he wasn’t going to leave without sealing the deal. He was personally taking charge of negotiations.
Top StoriesWaiting for the dust to settle
Many are praying that the euro crisis does not deteriorate even further, and among the most devout supplicants are M&A; bankers. The dark cloud of uncertainty hovering over the eurozone is hardly an enticement to deal-making. Valuations depend on heroic assumptions about future growth and interest rates. Financing deals, especially if they involve more than modest leverage, is more difficult. Above all, every time investors take fright at a particular market a political crisis also erupts, as in Ireland.read more
A divergence between private equity houses and private equity-backed corporates has emerged and is hampering both exit rates and corporate growth ambitions, which in turn could have consequences for private equity managers’ ability to raise new funds.
M&A; activity in distribution has remained strong despite the economic downturn, principally driven by strategic buyers.
Legal & Regulatory
Developed economies are witnessing the return of hostile M&A;, especially in the energy sector. However, the mismatch in value expectations between buyers and sellers continues to slow and complicate transaction processes in all regions and sectors.
There is likely to be an increase in M&A; activity in the technology, media and telecoms sectors over the next two years.
While much of Spain’s banking consolidation has focused on savings banks this year, the country’s medium-sized lenders are about to fuel the next round of M&A; activity, with some players expected to buy the newly-merged savings institutions or merge with each other, according to industry participants.
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