Speaking to the Anatolia news agency, Deloitte Turkey corporate finance partner Başak Vardar on Tuesday said Turkey has witnessed its most inactive period with regards to M&A activities in the first half of this year compared to the past five years. Vardar said the volume of merger and acquisition transactions in Turkey in the first half shrunk by 82 percent over that of 2008, approaching $2 billion in 59 M&A deals sealed.
Noting that there were not any M&As in the public sector, Vardar said there was a decline in the share of foreign investors in total M&A transactions.
“Of the total $2 billion in mergers and acquisitions in the first six months of 2009, 55 percent were made by foreign investors. This number was around 80 to 85 percent in past years. We also saw that most of the foreign investors have left the Turkish market, seeking to focus on their own countries' markets.” The finance expert said there was a remarkable decline in foreign investors' presence in Turkey, which is particularly noticeable when compared to 2008, when the highest rate of foreign transactions of all time was recorded in Turkey.
In the January to June period the greatest share of M&As were in the energy, food, technology and retail sectors. The majority of the M&As were conducted through the energy market, a fast developing field in Turkey. Vardar said despite the current negative outlook, M&As in Turkey will retain their strength and continue to increase in the years ahead. “Contrary to the nose-diving figures, we can not yet say foreign investors have entirely lost interest in the Turkish market; they still maintain their confidence. Foreign entrepreneurs are seeking new opportunities to tighten their grip in Turkey and are monitoring the latest developments closely,” he said.
With regards to 2009 year-end projections, Vardar said they anticipate Turkey's M&A transaction volume will not exceed $5 billion. “This is going to be the lowest since 2004, bearing in mind that the average yearly M&A transaction volume was $20 billion during the past three years,” he said. Underlining that a similar discouraging outlook is valid also in the rest of the world, Vardar said there was but a nascent recovery to this end in Turkish market.
