Spain Launches Itself From the Blocks in 2017

Spain is on track to continue its recovery in 2017 with corporate trading in the first six weeks of the year far surpassing that which was seen in the last weeks of 2016.

Corporate activity shot up to 6,000 million Euros in the first weeks of 2017 compared with the 4.7 billion recorded in the last quarter of 2016. This year’s figure is also an improvement on the corresponding weeks of 2016 when 5.340 million Euros was generated.

The good signs were almost immediate. In January, the transactional market in Spain closed with a total of 133 mergers and acquisitions having been announced and closed.  According to the monthly TTR report, this saw a total amount of investment across that kind of activity of 3.505 million euros.

All this follows the positive early months of 2016 which trounced the same period of 2015 in terms of M&A activity. Other factors also point to a continuing positive upturn such as record numbers turning out for Spain Investors’ Day in 2016.

INTO ACTION

So far, the most active sectors in 2017 have been real estate followed by technology with 29 and 23 transactions respectively.

Moving onto the venture capital market, 29 transactions were made in January to the total tune of 22 million euros. This is a 93 per cent increase on the number of such movements for the same period in January 2016 with a 17 per cent increase in capital involved.

Among specific transactions in this are Warburg Pincus’ 650 million euro purchase of Accelya, a financial and commercial solutions provider for the aeronautics sector. Then there was the acquisition of Vela Energy by Sonnedix for 700 million, the transfer of 1,800 telephony towers In France from Bouygues to Cellnex for 500 million and the sale of Merlin hotels portfolio to Foncière des Regions for 535 million.

AN INCREASED OPTIMISM

Regarding the rest of the year, Ignacio de la Colina, president of JP Morgan in Spain and Portugal, said, ‘We are moderately optimistic and expect an increase in activity compared to last year, helped in part by the greater sense of stability in our market.’

Looking at the influences of the picture in Europe overall, Pablo Pallás, head of Citi M&A for Spain and Portugal asserted that the political calendar in Europe was accelerating activity and that this would avoid the volatility seen in 2016 after Brexit. He added, ‘We expect a good number of sales processes that are currently marketed to be announced in the first half of the year.’

Francisco Sánchez-Asiaín, CEO of Nomura for Iberia, said, ‘We are seeing a rebound in the trading operations of companies which are usually transnational. The sentiment is changing towards a more optimistic dynamic. This explains why, despite the feeling of great uncertainty, mergers and acquisitions are spiraling upwards. Interest rates are still very low, and that leads companies to increase their investments [as they look for] opportunities for organic growth and through corporate operations.’

For more information, please contact corporate law firm Argali Abogados.

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