In 2015, the Mergers and acquisitions (M&A) market in Croatia improved significantly in value compared to recent years, but the public sector again disappointed investors, according to the latest Euromoney EMIS report.
The total value of the top ten M&A transactions in 2015 exceeded EUR 1bn, according to the “Emerging Europe M&A Report 2015/2016.” report, brought by EMIS, Euromoney’s company for institutional investors and the CMS legal advisor.
The report says that the public rector disappointed investors again in 2015 and that motorway concession procedure was suspended and there were rumours that the oil concession procedures
would be put on hold.
“This standstill, also true for other big-ticket state-owned projects, was accompanied by inconclusive results in the parliamentary elections late last year. A three month interim government contributed to a general investment deadlock,” the report said
The new prime minister with a business background and a new government are expected to significantly shape the Croatian investment landscape over the next four years, the report noted.
On a positive note, the private sector was far more active than in previous years. The total value of the top ten M&A transactions in 2015 exceeded EUR 1bn. Prominent deals included the takeover by British American Tobacco of the leading regional tobacco player TDR for EUR 550m; and the largest privately owned agricultural company Agrokor acquiring close to 70% of Vupik.
“In 2016, we expect the energy sector to be active, particularly in relation to LNG terminal development, and onshore and offshore exploitation of oil and gas,” the report said.
Tourism-related targets and green field investments are also certain to attract interest in Croatia. “We will likely see further privatisations of state-owned companies, including Croatian Post, HEP (national energy company), HZ Cargo (national railroad company), HAC (national motorway company), all airports, both state-owned banks, the national lottery and facilities with tourist potential (Kupari in Dalmatia, Brijuni and Muzil in Istria, state-owned hotels and former military resorts).,” the report said.