Mergers & acquisitions (M&A) volumes are holding up, both
internationally and in New Zealand, despite an unexpected period of
geopolitical and economic volatility.
Domestically, several large
transactions completed or kicked off late last year, including the sale
of Sistema Plastics to Newell Brands. Deal momentum is continuing this
year, with ANZ’s sale of UDC Finance to HNA Group for $660m, Spark’s
$22.7m takeover offer for TeamTalk, Tenon Clearwood LP’s purchase of
Tenon’s New Zealand-based Clearwood operations, and the $197m
acquisition of Tower by Fairfax Financial, now being contested by
Suncorp.
This publication explores likely trends and issues in the New Zealand M&A market this year.
Expected trends in 2017:
- A
gap between the number of cashed-up investors and the availability of
good quality New Zealand assets will see a sellers’ market in 2017,
resulting in strong price expectations, but without a return to the
irrational exuberance of 2007
- Robust private equity (PE) interest driven by cashed up PE firms on both sides of the Tasman
- An
improved Overseas Investment Act consent process will result in less
competitive advantage for domestic buyers in contested transactions as
shorter timeframes reduce the regulatory hurdle of gaining Overseas
Investment Office (OIO) consent
- Iwi will be more active dealmakers as they look to diversify their investments, and
- A
slow-down in activity as the New Zealand general election, scheduled
for 23 September, nears, with a potential burst of post-election
activity to follow.
Chapman Tripp has also released a supplementary publication, Mergers and Acquisitions - China/New Zealand trends and insights.
Expected trends in this publication include:
- New
currency controls in China may give New Zealand a competitive edge as
an investment destination as investors look to smaller markets like New
Zealand
- Chinese investment is diversifying, with increased
investment expected in sectors including tourism, financial services,
and value added food and nutraceuticals, and
- In the absence of TPP, China may seek an increase in New Zealand’s OIO consent thresholds.
View the video media release for that publication here.
Chapman
Tripp’s national M&A team partners with clients to successfully
execute some of the biggest, most complex and challenging transactions
in New Zealand. Our team has advised on more M&A work than any other
New Zealand firm, including many of New Zealand’s most significant
cross-border deals.
