In 2012, the adverse business environment caused a reduction in the amount of M&A transactions in the mechanical engineering sector by 43% to $1,263.6 million against $2,227.2 million in 2012, according to the recent issue of AK&M Information Agency's monthly bulletin MERGERS AND ACQUISITIONS MARKET (no. 192).
The number of transactions dropped by 11% (32 transactions against 36 the year before). Average deal value decreased by 36% to $39.5 million from $61.9 million in 2012.
The lower M&A activity in the sector results from a generally slower growth in the sector. In 2013, the M&A market underwent structural changes, the electrical equipment manufacture segment taking the lead in the amount of transactions, the transport machine building segment contributing the highest number of transactions. On the contrary, deals in the power engineering and mining equipment manufacture segments were few and far between, compared with a much stronger performance in the previous years.
The mechanical engineering segment still has a fertile ground for the M&A activity, primarily regarding foreign players. Transactions involving Russian machine-building enterprises are spurred by both their lower value and foreign companies' need to localize production in certain sectors (primarily in the vehicle component manufacture segment), AK&M analysts point out.
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"AK&M", 13.02.2014 18:18