Construction and development leads in Russian M&A market in January-June 2020

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AK&M 13 August 2020 16:27

In the first half of 2020, the construction and development sector ranked first in the M&A activity in the Russian market with 101 transactions totaling $3.45 billion, which is 78.6% higher above the 1H19 result ($1.93 billion), according to the recent issue of AK&M Information Agency's MERGERS AND ACQUISITIONS MARKET monthly bulletin.

The number of transactions increased 1.7 times against the previous year's result (59). The sector accounts for 47.9% of the total number of transactions, 23.4% of the market volume. The largest transaction of the 6-month period was the acquisition by Samolet Group of a 165 ha land plot in New Moscow in the south of Filimonkovskoe settlement for a mega residential construction project for an estimated $466.4 million.

The information technology (IT) sector ranked second with 10 transactions for a total amount of $3.06 billion against 16 transactions for a total amount of $3.22 billion in the first half of 2019. The industry accounted for 20.8% of the total half-year M&A market volume in Russia. The largest transaction of the period was the sale of Anton Cherepennikov's X Holding to Alisher Usmanov's entities for an estimated amount of $2.17 billion.

The electric power industry stands third in January-June (15.2% of the market volume) with 4 deals worth $2.24 billion against 4 deals worth $386.7 million in January-June 2019. The largest transaction of the period was the consolidation by Finland's Fortum Corporation of a 73.4% stake in Germany's Uniper which owns 83.73% of Russia-based Unipro PJSC for an estimated amount of $ 2.01 billion.

The fuel and energy sector ranks fourth with 4 transactions for a total amount of $2.01 billion (13.7% of the market volume), which is 5.7 times below the result achieved in January-June 2019 (12 M&A events, $11.5 billion). The largest transaction of the period was the acquisition by Albert Avdolyan's A-Property of a 51% equity stake in the Elga coal project for $1.93 billion. The largest transaction of this year registered in the fuel and energy sector (the purchase by Onega Holding of a 99.57% stake in JSC Mezhdurechye, the main mining asset of Sibuglemet Holding, from state-owned Corporation VEB.RF for $3.56 billion in February) was canceled on August 6.

The mechanical engineering sector rounds out the top 5 with 10 deals worth $1.06 billion (7.2% of the market volume) against 6 deals for a total amount of $2.32 billion in January-June 2019. The largest of these deals was the purchase by Dmitry Strezhnev's UMG Group of GAZ Group's assets (100% of URAL Motor Vehicles Plant and 100% of RM-Terex Holding) with an estimated value of $521 million.

More details on the M&A market results in the first half of 2020 are provided in issue 268 of AK&M Information Agency's MERGERS AND ACQUISITIONS MARKET monthly bulletin.

All bulletins of AK&M Information Agency are available on the AK&M Research Bulletin Store.