MEA M&A Deal Values Up 26.9% In 2013

The total value of mergers and acquisitions (M&A’s) across the Middle East and Africa rose by 26.9 per cent to $64.2 billion in 2013, up from $50.6 billion in 2012.

According to a Mergermarket report, the region recorded the highest rise in deal value in the last six years with all quarters in 2013 posting values above $12 billion.

M&A deal value in Q4 2013 was up by 5.5 per cent from the previous quarter to reach $15.4 billion in 2013. However deal value was down by 17.2 per cent when compared to Q4 2012 when values touched $18.6 billion, the report said.

The highest valued deal for the region was the merger of UAE’s state-owned firms Dubai Aluminium Company and Emirates Aluminium at $7.5 billion earlier last year.

Telecom provider Etisalat’s acquisition of a 53 per cent stake in Maroc telecom for $6.1 billion was the second highest valued deal last year and was the highest valued deal in Q4 2013. The report said that the acquisition was also responsible in boosting the overall value of deals in the telecoms, media and technology (TMT) sector.

Inbound deal value was up by 58.3 per cent to reach $36.4 billion, compared to 2012. Total outbound deal value was valued at $17.1 billion, up by 7.5 per cent compared to the previous year.

Energy, mining and utilities sector recorded the highest deal value at $23.1 billion, up 26.2 per cent when compared to 2012.

The report also found that the TMT companies in the region were being more active in domestic M&As.

The Middle East has been seeing a steady rise in deal activity in the last few years as the economy recovers.

“Some element of M&A caution still exists given the backdrop of the global economy and MENA geopolitical factors,” said Phil Gandier, MENA transaction advisory services leader, Ernst & Young.

“However, there continues to be a growing corporate appetite in M&A activity due to the strong financial fundamentals of the MENA region’s capital agenda as indicated by EY’s recent capital confidence barometer study.”