2020: The year of acquisition for domestic firms

By Mehmet Kaya

In 2020, 26 companies controlled by Turkish citizens were bought by foreigners while foreign companies acquired by Turkish citizens stood at 11, according to Competition Authority’s report. Accordingly, the total amount of acquisitions made by foreigners was TRY 9.9bn while Turkish buyout of foreign companies stood at TRY 11.8bn. This indicates that Turkish-acquired foreign companies worth more than the Turkish companies acquired by foreigners.

2020 was the year of “nationalization” in company acquisitions, the Competition Authority’s Merger and Acquisition Outlook report said. The amount of foreign companies acquired by Turkish citizens surpassed the foreigners’ acquisitions of Turkish companies in 2020.

The report only includes the transactions that subject to competition authority’s approval. Mergers and partnerships with companies exceeding turnover threshold needs an approval of the Competition Board, according to the Competition Law. All privatization transactions can also be concluded with the permission of the Competition Board. In addition, even if the main mergers and acquisitions took place outside Turkey, if one of the companies has operations in Turkey, you need to get approval from the Competition Board for the transactions.

Germans took the lead

For the first time in the last five years, the amount of foreign companies bought by Turkish citizens was higher than the amount of foreigners buying Turkish companies. In transactions where the transferee is the foreigner, German companies were in the lead. Germany-based companies acquired 5, Luxembourg and the UAE-based companies each acquired 4, U.S.-based companies 3 and Austrian citizens acquired 2 Turkish companies.

USD 2.6tr international transactions

The Competition Board approved 88 mergers and acquisitions within Turkey in 2020. Of these, 75 were mergers-acquisitions, 11 were out of scope due to being within the group, and 2 were transactions within the scope of others. The total amount of the transactions was reported as TRY 29.1bn. Of the 75 merger-acquisition transactions, 71 were company buyouts by another company, 3 as joint ventures, and 1 as a merger.

Competition Board gave approval to a total of 220 merger and acquisition requests within Turkey and abroad, 132 of which were international transactions. The reported total amount of these transactions carried out abroad amounted to USD 2.6tr.

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