2014 M&A Trends In Spain

2014 M&A Trends In Spain

2014 M&A Trends In Spain

The number of M&A transactions completed in Europe has rebounded this year following the slump that occurred towards the end of 2013 and, encouragingly, Spain has been a hub of activity as the country’s recovering economy has rekindled investor confidence. M&A deals drive growth and it’s the gift that keeps on giving as far as Spain goes, with GDP growth forecast to outpace that of eurozone peers like France and Italy in 2015.

Against this positive backdrop, top investors like Microsoft chairman Bill Gates and hedge fund billionaire George Soros have picked up Spanish assets, ranging from property to security firms and building companies, and leading US investment funds like Blackstone have snapped up savings banks’ assets. So where are the M&A opportunities for investors going forward and will the trends remain the same? The banking, manufacturing and retail sectors are seen as prime targets.

 

BANKS STILL LURE INVESTORS

Spain’s financial sector has undergone a substantial restructuring process aimed at cleaning up the banks balance sheets, strengthening their capital and enabling them to turn the credit tap back on. While these entities are facilitating M&A deals by easing the restrictions on lending, some of them are still on the acquisition trail. Top banks like BBVA continue to seek to boost their market share by buying smaller savings banks. Spain’s manufacturing sector is also on the radar for investors keen to increase their presence in one of the country’s main exporters – the export sector has been a major growth driver over the last 18 months.

But for some private investors and international funds it’s been the retail market’s potential which has caught their eye, particularly in Madrid and Barcelona, ahead of the expected uptick in domestic demand. These investors hope new opportunities will emerge which will be highly profitable in the long run since yields will be much higher than in other more expensive European capitals like Paris or London.

 

GOVERNMENT BACKS INVESTMENT

Spain exited a two-year recession in late 2013 and the latest batch of economic data show economic revival is consolidating. The government is playing its part in helping to create an attractive business environment, offering a range of sweeteners to domestic and international firms who invest in Spanish firms. These include: financial incentives for start-ups, tax breaks for firms which invest in R&D, corporate tax rate cuts from 2015, and even new measures to facilitate M&A. The list is endless! So investment banks and private equity firms with dry powder ready to invest are likely to continue to bet on Spain.

For information on investing in Spain, contact corporate law firm Argali Abogados.

2014 M&A Trends In Spain

 

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