The construction industry is among the most attractive fields for M&As in Vietnam (Photo: cafef.vn)Hanoi (VNS/VNA) -Vietnam has been ranked second after the US on a list of the world's mostactive, dynamic and potential markets for merger andacquisition (M&A) deals this year.
According to the latest M&AInvestment Index compiled by research firm Euromonitor, Vietnam's standinghad increased from last year.
Vietnam was listed amonga group of countries with positive M&A prospects together with China,the Philippines, Taiwan and Saudi Arabia.
Euromonitor forecast that Vietnamwould retain its position in the top 20 countries with the highest investmentM&A index in 2021, surpassing China and Indonesia.
According to the report, Vietnamwas also in the top five markets with the fastest M&A growth performance inthe world, behind Singapore, Ireland, the Philippines and Qatar.
The driving forcebehind M&A deals in Vietnam and other countries in Southeast Asiawas a result of foreign investments shifting from China to avoid the risksposed by the US-China trade war.
At the same as time, due to theCOVID-19 pandemic, many Western governments have lowered their interest ratesto reduce borrowing costs.
The region’s low borrowingcosts and depressed asset values would present acquisition opportunitiesfor businesses from the US and Western Europe, said the research firm.
Joao Luiz Paschoal, consultingpractice manager for investor services at Euromonitor International,said: “Countries such as India, the Philippines and Vietnam areforecast to grow rapidly at a total of 26 percent in industries includinginteractive media services, distribution networks, and sustainable alternativesin packaged food.”
Euromonitor believed the mostattractive fields for M&As included construction, distribution networks,manufacturing and public infrastructure. The firm said from 2015-2019,China and the US had been the two most dynamic M&A markets in theworld.
However, the report said theglobal economic landscape was changing because of their trade dispute andreforms made to local economies and politics in Southeast Asiawould enable growth in regional investment, making it an attractivedestination for M&A activities.
As ASEAN’s M&A environmenthas changed over the past five years, deals have seen a shift in structure andindustries, while the number of global M&A deals decreased bymore than 20 percent in the same period.
According to Euromonitor, NorthAmerica was the most vibrant destination for M&A deals from 2015-2020,followed by Western Europe and Asia-Pacific. The firm also forecast thatfrom 2020-2021, South America would lead M&A growth with 13.7 percent,followed by Asia Pacific with 8.2 percent.
The Ministry of Planning andInvestment (MPI), reported the total value of M&A transactions reachedabout US$10 billion in 2018, up 60 percent over the previous year. Last year,M&A deals reached $15.6 billion in value, an increase of 54 percent from2018.
The MPI’s data showed the twoindustries with the strongest M&A activities in 2018 and 2019 were consumergoods production and real estate. Other key industries included consumerfinance, retail, fisheries, logistics and education.
The ministry alsosaid investors from Korea, Japan and Singapore played a very importantrole in the country's M&A market in 2018 and 2019 with an impressive volumeof transactions completed.
The European BusinessAssociation in Vietnam recently forecast that M&As would continue togrow strongly in 2020 as foreign investors sought entry into the localmarket, adding that Vietnam should also take full advantage of the benefitsprovided by free trade agreements, including the EU-Vietnam Free TradeAgreement (EVFTA).
Nguyen Mai, Chairman of theAssociation of Foreign Investment Enterprises, told Vietnam News: “There is noway to stop the wave of M&As, even during the COVID-19 pandemic,because businesses are facing difficulties and need to call for investmentfrom external sources to rescue themselves."
“The M&A phenomenon willbecome stronger and stronger, especially while Vietnam is still in theprocess of equitisation,” Mai added.
Euromonitor International’sFinancial and Investment Services practice developed the M&A InvestmentIndex, reflecting the expected level of investment, activity andattractiveness of the global M&A market amid macroeconomic and financialshocks. The model covers a total of 314,002 M&A deals from 50countries and over 150 industries worldwide between 2015 and 2020./.
According to the latest M&AInvestment Index compiled by research firm Euromonitor, Vietnam's standinghad increased from last year.
Vietnam was listed amonga group of countries with positive M&A prospects together with China,the Philippines, Taiwan and Saudi Arabia.
Euromonitor forecast that Vietnamwould retain its position in the top 20 countries with the highest investmentM&A index in 2021, surpassing China and Indonesia.
According to the report, Vietnamwas also in the top five markets with the fastest M&A growth performance inthe world, behind Singapore, Ireland, the Philippines and Qatar.
The driving forcebehind M&A deals in Vietnam and other countries in Southeast Asiawas a result of foreign investments shifting from China to avoid the risksposed by the US-China trade war.
At the same as time, due to theCOVID-19 pandemic, many Western governments have lowered their interest ratesto reduce borrowing costs.
The region’s low borrowingcosts and depressed asset values would present acquisition opportunitiesfor businesses from the US and Western Europe, said the research firm.
Joao Luiz Paschoal, consultingpractice manager for investor services at Euromonitor International,said: “Countries such as India, the Philippines and Vietnam areforecast to grow rapidly at a total of 26 percent in industries includinginteractive media services, distribution networks, and sustainable alternativesin packaged food.”
Euromonitor believed the mostattractive fields for M&As included construction, distribution networks,manufacturing and public infrastructure. The firm said from 2015-2019,China and the US had been the two most dynamic M&A markets in theworld.
However, the report said theglobal economic landscape was changing because of their trade dispute andreforms made to local economies and politics in Southeast Asiawould enable growth in regional investment, making it an attractivedestination for M&A activities.
As ASEAN’s M&A environmenthas changed over the past five years, deals have seen a shift in structure andindustries, while the number of global M&A deals decreased bymore than 20 percent in the same period.
According to Euromonitor, NorthAmerica was the most vibrant destination for M&A deals from 2015-2020,followed by Western Europe and Asia-Pacific. The firm also forecast thatfrom 2020-2021, South America would lead M&A growth with 13.7 percent,followed by Asia Pacific with 8.2 percent.
The Ministry of Planning andInvestment (MPI), reported the total value of M&A transactions reachedabout US$10 billion in 2018, up 60 percent over the previous year. Last year,M&A deals reached $15.6 billion in value, an increase of 54 percent from2018.
The MPI’s data showed the twoindustries with the strongest M&A activities in 2018 and 2019 were consumergoods production and real estate. Other key industries included consumerfinance, retail, fisheries, logistics and education.
The ministry alsosaid investors from Korea, Japan and Singapore played a very importantrole in the country's M&A market in 2018 and 2019 with an impressive volumeof transactions completed.
The European BusinessAssociation in Vietnam recently forecast that M&As would continue togrow strongly in 2020 as foreign investors sought entry into the localmarket, adding that Vietnam should also take full advantage of the benefitsprovided by free trade agreements, including the EU-Vietnam Free TradeAgreement (EVFTA).
Nguyen Mai, Chairman of theAssociation of Foreign Investment Enterprises, told Vietnam News: “There is noway to stop the wave of M&As, even during the COVID-19 pandemic,because businesses are facing difficulties and need to call for investmentfrom external sources to rescue themselves."
“The M&A phenomenon willbecome stronger and stronger, especially while Vietnam is still in theprocess of equitisation,” Mai added.
Euromonitor International’sFinancial and Investment Services practice developed the M&A InvestmentIndex, reflecting the expected level of investment, activity andattractiveness of the global M&A market amid macroeconomic and financialshocks. The model covers a total of 314,002 M&A deals from 50countries and over 150 industries worldwide between 2015 and 2020./.
VNA
