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Portuguese M&A continues to be driven by foreign investment, with an uptick in US-based bidders

  • Foreign investment has accounted for 90.2% of Portuguese deal value and 69.9% deal volume
  • US investment into Portugal has seen an uptick
  • Overall M&A in Portugal fell, in line with European activity to just 49 deals worth EUR 2.5bn in 2019 YTD

30 October 2019, Lisbon, Portugal: Mergermarket, the leading provider of M&A data and intelligence, has announced that foreign investment into Portugal has accounted for 90.2% of Portuguese value so far this year, the highest figure since the financial crisis. In the year so far, 8 of the largest 10 deals targeting Portugal were conducted by foreign bidders.

US investment has also seen a clear uptick, with a total of 7 deals by US-based bidders, the highest YTD number on record and just one behind last year’s full-year record. This means that US-based bidders are now the most active investors into Portugal by the volume as well as by value (7 deals worth EUR 843m). Two of the biggest deals with US bidders include Oaktree Capital Management LP’s acquisition of Andre Jordan Group for EUR 500m and Certares LP’s tie-up with Mystic Invest Holding worth EUR 250m. The rise of US investment comes on the back of falling interest from China, as a result of greater controls by Chinese and European governments to curtail dealmaking. Portugal has failed to see any deals from Chinese bidders so far this year, down from a joint-high three deals in 2018. The data was announced at Mergermarket’s 3rd annual M&A Outlook: Portugal Breakfast Briefing held at the Four Seasons Hotel Ritz in Lisbon on 30th October 2019, sponsored by Cuatrecasas, the leading legal advisor by volume of announced deals in the Iberian Peninsula between 2013 and 2017 and YTD 2019, and Marsh, the world’s leading insurance broker and risk adviser.


Despite the jump in foreign investment, Portugal (EUR 2.5bn, 49 deals) has experienced the lowest YTD M&A deal value since 2013 (30 deals, EUR 2.1bn). After a blockbuster 2018 that saw 99 deals worth EUR 5.6bn, Portuguese M&A has returned to more subdued levels of dealmaking weighed down by regional and international challenges. The trend mirrors a general slowdown across other countries in Europe, with Brexit and growing international trade tensions all weighing on confidence to conduct deals.

Private equity activity in the country has slowed down to almost a halt, with just seven deals worth EUR 500m in the year so far, compared to 12 deals in both 2017 and 2018 worth EUR 1.1bn and EUR 1.5bn, respectively. Yet, private equity exits have seen a surge so far this year with 11 deals worth EUR 762m, the highest volume since 2015, which saw five deals worth EUR 997m. The current market appears to provide an optimal time for private equity firms to sell, with valuations still high before a potential economic downturn.

The most active sector in Portuguese M&A was energy mining & utilities (EMU) with 29.3% of the market share. The value of energy deals in Portugal in the first three quarters of 2019 has more than quadrupled compared to the same period in 2018, to EUR 739m from EUR 161m. This reflects the fact that Spain and Portugal were home to an annual average of 12.5% of the continent’s EMU M&A value since 2014, only behind the UK (35.4%) and Germany (13.1%). However, financial services is close behind, with 27.2% of the market share in 2019.

Jonathan Klonowski, Research Editor EMEA, Mergermarket commented: "Despite an overall downturn in Portuguese dealmaking, foreign investment into the country has remained robust, spurred on by buoyant US activity."

Mariana Norton dos Reis, partner of Cuatrecasas, commented: “The Portuguese pipeline of ongoing and forecasted transactions is much better now than it was a year ago. There is, of course, some uncertainty at the European level, but we feel that Portugal has managed to demonstrate stability, attracting foreign investors and providing them with the necessary confidence.” 

Francisco Santos Costa, partner of Cuatrecasas, commented: “Recently in Portugal, many M&A deals have taken place in the energy sector, mainly related to the energy transition. International funds and corporate investors have the liquidity to invest in renewable energy assets. Portugal has long been preparing for this. After an emphasis on wind farms and hydroelectric power plants, solar energy is now attracting investors’ attention."

Rodrigo Simões de Almeida, Country Manager Marsh Portugal, commented: “Foreign investor activity in Portugal (namely from the US) brought risk to the agenda of M&A deals. This has led buyers and sellers to consider risk advisory services as a necessary milestone and recognise the added-value of transactional risk transfer solutions”. 

Eduardo Navarro, CEO Sherpa Capital, commented: “We are very focused on the Portuguese mid market because we believe it’s one of the most interesting markets in Southern Europe nowadays and for the following years. We have closed two deals in the last twelve months and we are very eager to increase our investment in the Portuguese market”.

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