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Austrian M&A Activity Faces Depression

Published: July 11, 2012; 19:11 · (Vindobona)

Due to the global insecurities, the M&A activities in Austria decreased substantially in the last year. Against the prior year, the number of deals was down by 27%.

Austrian M&A Activity Faces Depression / Picture: © Vindobona.org

In Austria, the number of mergers and acquisitions fell dramatically. According to Christopher Kummer, director of IMAA (Institute of Mergers, Acquisitions and Alliances), there are fewer foreign buyers than ever.

In the first half of 2012, there were several bigger transaction in Austria. Nevertheless, the level of 2011 could not be maintained. In the first six months, 121 deals were observed. A report of IMAA shows that the volume of M&A deals reached € 6.1bn. In total, this is a slump of 27%. At least, the size of transactions doubled.

However, the volume of M&A activities would not be a significant indicator. The biggest deal, which is the takeover of the Portuguese cement company CIMPOR by InterCement Austria Holding, is no Austrian deal. InterCement Austria is a subsidiary oft he Brazilian Grupo Votorantim. Kummer thinks that the deal was made for tax reasons. What is more, the fourth-biggest transaction, which ist he share-buy back at Raiffeisen Bank International (RBI), is not classic M&A activity.

Kummer explains that the current crisis makes companies more cautious. IMAA´s director underlines the importance of liquid assets at the moment.

However, there would be some takeovers in CESEE countries by Austrian companies, Kummer points out. In general, Austrian companies would be more active than other foreign investors in the CESEE region. At the moment, about 42% of the transactions took place in Austria. 35% oft he deals were made by Austrian enterprises in foreign countries.

For the rest oft he year, Kummer does not expect a recovery of the M&A activity. „The market remains difficult as the euro-crisis is not solved yet.“ he concludes.

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