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Tribune News Network
DOHA
Qatar is among the top five countries for mergers and acquisitions (M&A) activity in the energy and natural resources (ENR) sector in financial year 2016/17, a KPMG report has said.
The"M&A predictor" analysed historical deal information and provides an outlook on what can be expected in the coming year. At ENR-related deals worth more than $11.6 billion, Qatar ranks fifth in the world, with the US, China, Canada and Russia taking the top four spots on the list
On the findings, Hady Kotry, Deals Advisory expert at KPMG in Qatar said,"Mergers and acquisitions are fundamental growth factors for any economy, and for Qatar to be in the top list of global energy mergers is a notable landmark, with QIA's investment in National Grid PLC in the UK being an obvious turning point."
He said it was still too early to comment on future global energy trends given the volatility that impacts the industry, including the trade-off between investors' appetite towards renewable, safe energy versus higher return on investments, which will be key factors in driving future trends.
Overall, the report highlighted that globally M&A appetite (which is measured by market confidence or price-to-earnings ratio) was predicted to only marginally increase during FY17, largely due to flat market capitalisation and modest net profit growth.
Qatar's M&A appetite is forecast to grow by 11.5 percent by the end of FY17-18. On this, Kotry noted:"A prediction of 11.5 percent appetite for deals in Qatar shows a positive future outlook, however caution is required to ensure efficient and effective post-merger integration/post acquisition strategies to ensure value is realized."
This year, Qatar is expecting to see mergers in a number of sectors including banking, technology and telecommunications, construction and food and beverages, in line with global trends.
