Mergers and acquisitions train misses the Middle East because of exaggeration in prices
2412 2015

Thomas Arnold and David French
Dubai December 24 (Reuters) - Global mergers go through boom and acquisitions valued over the Middle East, where regional deals are disabled because of the persistence of sellers assessments despite the decline of the oil price.
While prompted a series of mega deals global mergers and acquisitions volume in 2015 to a record level of $ 4.6 trillion, the total reached the Middle East deals did not exceed 12.68 billion dollars throughout the year until the seventh of December, according to data from Thomson Reuters.
This brings the year is the slowest in terms of value since 2011 and is moving to become the lowest in terms of the number of actual transactions since 2007.
Decline comes after a period when activity driving economic growth - thanks to generous government spending and the high proportion of young people among the population - direct investment market in the region and raise assessments, particularly in the sectors of consumer products, health care and education.
But the assessments required by the sellers after that fueled expectations that prosperity are still flying in the sky, despite the shadows that delivered oil fell to its lowest level in 11 years on expectations of growth in the region.
Said Richard Dallas, Managing Director of Gulf Capital, based in Abu Dhabi, "I do not think that the sellers expectations have changed at all in response to oil prices," pointing out that "as in any real estate market, the first phase of the correction period is the lack of liquidity."
Compare source and sector assessments gap between sellers of public and private sector markets given the decline in most of the GCC stock exchanges about 15 percent this year.
One reason for the reluctance of potential sellers to make concessions is that many family-owned companies, which are often linked emotionally Bomlakha.
In other cases, sellers do not want to succumb to the change in economic conditions after the promised advisers competitors to offer their services high assessments.

He said Mustafa Abdul Wadud group of towers that focus on emerging markets. "It's the wrong debate to try to adjust the price in advance to end up with the wrong partner or without a deal."

The result is that the completion of transactions take a long time because of the ongoing debate between the buyers and sellers to reach a mutually acceptable price or they simply fail.

* Depletion deals

And selling "Dunia Finance" One example where the sources pointed out that the company's initial interest in consumer finance in August faded after that for the price expectations of sellers led to the reluctance of potential buyers.

Could not immediately contact one to comment on the status of the sales process or a minimum of current owners swap and Waha Capital in Abu Dhabi. It declined to Temasek Holdings of Singapore, which is the unity of its third contributor in the world to comment.

Similarly faced the joint offer from and blew Capital, based in Dubai for the purchase of 25 percent in Azadea Group difficulties due to lack of agreement on valuations between buyers and Family Group, which owns retail Eastern company.

While the Middle East began to benefit from the entry of global direct investment companies targeting the big deals such operations remain rare. And at least most of the volume of transactions for $ 200 million and limited to local parties.

But the picture is not pitch-black population growth makes it relatively safe sectors such as food and beverage, health care alluring.

Another factor cause for optimism is the climate and economic uncertainty has led some companies to start talks with advisers about ways to manage liquidity through the sale of assets.

He said Raymond Hurley specialized financial services deals in specialized services "We are receiving many inquiries from family groups who taught many of which are difficult strategic decisions ... and looking for the possibility of doing transactions and integrate acquisitions and divestment of investments."

(Preparation Ahmed Inspirational Arab Bulletin - Edit Nadia Aljowaily)