More than ever, venture capital is this year playing a important role in the M&A market of mergers and acquisitions. With a total of 70 business transactions in the first nine months of 2020, for a total value of 9.4 billion euros, private equity played a role in no less than 23% of the transactions, more than 2 percentage points more than last year when the percentage was 20.7% over the same period. This is a new historical record.
The funds managed to hit that record by participating as buying party in three mega-operations (worth more than 1 billion) that are among the top ten transactions registered in Spain and Portugal.
Boom expected in 2021
Moreover, the peak of this trend has not yet been reached, according to a manager of one of the most important international consultancy companies in Spain. “Private equity is playing an increasingly important role.” It is expected that from the second half of next year (2021) there will be a veritable boom in transactions in the M&A market, with venture capital playing an even more important role.
“The number of transactions has not yet increased enormously, but when companies face a difficult situation as a result of the financial loans they received because of the corona crisis, and that have to be paid off at some point, opportunities will undoubtedly arise in the market,” said the expert.
Americans lead the ranking
The major North American investment funds are increasingly leading the ranking of financial consultants in the Iberian market (Spain and Portugal) when it comes to acquisitions and mergers. According to data from Mergermarket, JPMorgan tops the list with 7 transactions worth over $ 18.5 billion, ahead of Morgan Stanly (15.8 billion) and Citi (15 billion).
The firm, led in Spain by Ignacio de la Colina, was responsible for, among other things, the merger of Telefónica O2 and Virgin, and was involved in the closure of Santander in Puerto Rico, the sale of Sabadell’s fund manager and the sale of Viesgo.
However, if we look at numbers of transactions in the M&A market, the Big Four are at the top: PwC (39), EY (22), Deloitte (20) and KPMG (12).
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