Rebound projected in M&A transactions in manufacturing and transport
12 Jan 2018 - by Staff reporter
There should be a rebound in global merger and acquisition (M&A) transactions in the Industrials, Manufacturing and Transport (IMT) sector in 2018, with global M&A rising to US$531.4 billion, up from US$483 billion in 2017.
Legal firm Baker McKenzie’s Global Transaction Forecast projects that M&A activity in the IMT sector will be worth US$2.9 billion in Africa and the Middle East in 2018, up from US$ 2.7 billion in 2017. In 2019, deal value in the IMT sector in Africa and the Middle East will increase further to US$ 3 billion.
Sonia de Vries, partner and head of the IMT Sector Group at Baker McKenzie in Johannesburg, said that China’s One Belt, One Road initiative to build trade and transport links across Asia and Africa was likely to accelerate infrastructure spending throughout the region, providing new M&A opportunities for construction companies in 2018.
“Countries in Africa that will benefit from the One Belt One Road initiative include Kenya, Tanzania, Ethiopia, Djibouti and Egypt. East Africa has an integral role in the initiative, owing to Djibouti’s ports, Ethiopia’s manufacturing, and the region’s existing plans to connect rail, road and energy networks. Infrastructure is incredibly important for the development of the energy sector in the region, which is in turn key for economic growth. Major transactions related to projects in the power and infrastructure sector and related financing are also in the pipeline. This will contribute to the increase in deal volume and value in the IMT space in 2018,” de Vries added.