Volume 1• Issue 2 M&A Alan M Klein leads the global interview panel covering 20 key economies Is CEO confidence returning? North America ∙ Asia-Pacific ∙ Europe ∙ Latin America Activity levels ∙ Keynote deals ∙ Inside track ∙ 2014 trends Publisher: Gideon Roberton Senior business development manager: Adam Sargent [email protected] Product manager: Rachel Nurse Marketing assistant: Sophie Pallier [email protected] Head of production: Adam Myers Editorial assistant: Eve Ryle-Hodges Senior subeditor: Caroline Rawson Welcome to GTDT: Market Intelligence. Senior production editor: Amie Retallick Production assistant: Nathan Clark This second issue focuses on the global M&A markets. Cover: Getting the Deal Through invites leading practitioners to reflect on evolving legal and GordonBellPhotography/iStock/Thinkstock regulatory landscapes. Through engaging and analytical interviews, featuring a uniform set of questions to aid in jurisdictional comparison, Market Intelligence offers readers a No photocopying. CLA and other agency highly accessible take on the crucial issues of the day and an opportunity to discover licensing systems do not apply. For an more about the people behind the most interesting cases and deals. authorised copy contact Adam Sargent, tel: +44 20 3780 4104 Market Intelligence is available in print and online at www.gettingthedealthrough.com/intelligence This publication is intended to provide general information on law and policy. The information and opinions which it contains Getting the Deal Through are not intended to provide legal advice, and London should not be treated as a substitute for specific November 2014 advice concerning particular situations (where appropriate, from local advisers). Published by In this issue Law Business Research Ltd Law Global Trends ........................................................................................2 Business Africa – A Regional Overview ................................................................4 Research Argentina ............................................................................................10 Brazil ..................................................................................................17 87 Lancaster Road London, W11 1QQ, UK Canada ...............................................................................................23 Tel: +44 20 3780 4104 China ..................................................................................................30 Fax: +44 20 7229 6910 Czech Republic ....................................................................................35 ©2014 Law Business Research Ltd ISSN: 2056-9025 Dominican Republic..............................................................................41 Finland ................................................................................................44 France .................................................................................................50 Germany .............................................................................................56 India ...................................................................................................62 Japan ..................................................................................................69 Strategic Research Sponsor of the Netherlands ........................................................................................75 ABA Section of International Law Norway ..............................................................................................79 Russia .................................................................................................86 South Africa ........................................................................................92 Printed and distributed by Spain ..................................................................................................97 Encompass Print Solutions Switzerland .......................................................................................103 Tel: 0844 2480 112 United Kingdom .................................................................................109 United States .....................................................................................115 GLOBAL TRENDS Alan M Klein is a partner of Simpson Thacher and Bartlett LLP and a member of the firm’s corporate department with extensive experience in mergers and acquisitions, shareholder activism and corporate governance matters. He represented Microsoft on its US$7.2 billion acquisition of Nokia’s phone business, its US$8.5 billion acquisition of Skype and its investment in Barnes & Noble’s Nook business. Other clients have included Tyco International, Best Buy, Chinalco, Gas Natural SA, Portugal Telecom, Gerdau Ameristeel, Bavaria SA and Owens-Illinois. In 2012, The American Lawyer named him a ‘Dealmaker of the Year’. He is a frequent commentator on M&A issues. Klein serves as Simpson Thacher’s co-administrative partner and is a member of the firm’s executive committee. In this overview Klein takes a look at global M&A activity levels in the past year, key transactions and trends in significant sectors, and the future for M&A activity in the face of geopolitical and economic uncertainty. GLOBAL TRENDS ALAN M KLEIN OF SIMPSON THACHER & BARTLETT LLP Global M&A activity levels have surged in the There had been a clear reluctance by CEOs past year. In the first nine months of 2014, the during the past five years or so to engage in large- volume of transactions worldwide has increased by scale transformative transactions, except in rare approximately 60 per cent compared with the first circumstances. Uncertainty about the global nine months of 2013, representing US$2.66 trillion economic climate following the financial crisis of of transactions, according to data from Thomson 2008–2009 and the global recession that resulted, Reuters. The aggregate value of transactions in the concerns about the stability of the eurozone and first three quarters of 2014 has exceeded the value disputes over the United States’ debt ceiling had of the full year’s worth of transactions for each of all contributed to an unwillingness by companies the previous five years. 2014 now looks as if it will to take risks during that period. The market began be exceeded only by 2007 in terms of deal activity, to shift during 2013 and mergers and acquisitions when the value of the year’s transactions totalled gained momentum as the year went on. That US$4.7 trillion. There were a record number of momentum picked up tremendously in 2014, transactions over US$5 billion in the first three as transactions became larger, more global and quarters of 2014. The greatest increase in activity included a greater variety of business sectors. was in the United States, but there have been The energy and power sector has had the most significant increases in deal activity in Europe and deal volume through the first nine months of 2014, the Asia-Pacific region as well. with the deals totalling US$376.2 billion, a 56 per 2 www.gettingthedealthrough.com GLOBAL TRENDS cent increase over the same period in 2013. The level of mergers and acquisitions picked up. Four of health-care sector was not far behind, however, with the ten largest transactions announced in the first US$368.6 billion of announced transactions in the nine months of 2014 were inversions. The string of first three quarters of 2014. The global consolidation inversion transactions in 2014 include AbbeVie’s of pharmaceutical companies, which has taken place agreement to acquire Shire, referenced earlier, in waves of activity over the past 30 years, resumed in Medtronic’s announced plan to acquire Covidien, 2014 at what seemed like a fevered pace. A sampling Mylan’s agreement to acquire Abbott Laboratories’ of these transactions include AbbeVie Inc, a US- non-US generic business and the pending based company, which agreed to buy Shire PLC, of combination of Chiquita Brands International and Ireland, for US$54 billion. Actavis, an Irish company, Fyffes. agreed to buy Forest Labs, a US business, for A public backlash arose in the US over the US$25 billion. Bayer AG entered into an agreement perceived stream of US companies managing to buy Merck & Co’s consumer-health for to move their incorporation outside the US in approximately US$14 billion. Roche Holding AG connection with these cross-border transactions. agreed to buy two US companies for a total of Pressure began to build for action to be taken US$10 billion. And GlaxoSmithKline and Novartis to limit the ability of US companies to move are swapping US$20 billion of assets with one their country of incorporation in connection another. with a business combination. Finally, at the end These agreed transactions do not include of September 2014, the US Department of the almost US$200 billion of unsuccessful offers Treasury issued a set of rule modifications intended in the pharmaceutical industry. Pfizer made a to limit the ability of companies to take advantage US$116 billion offer for AstroZeneca, which was of the benefits of these inversions. These rules took spurned by AstroZeneca. Allergan has continued immediate effect and applied to any transactions to fend off a US$53 billion unsolicited offer from still pending and not yet completed. These rule Valeant Pharmaceuticals, which has teamed up changes did not ban these transactions, since that with stockholder activist William Ackman, in one requires action by the US Congress, which was of the most high-profile hostile transactions in not forthcoming. However, the amended rules recent years. And Mylan Inc made an unsuccessful did greatly limit certain of the intended benefits multibillion-dollar offer for Meda AB of Sweden. of inversions. It remains to be seen what effect the Examining the geographic dispersion of M&A limitations on inversions will have on cross-border activity for the first nine months of 2014 shows that deal activity in the near term. the United States has had the biggest share of the The outlook for global M&A activity should increase in M&A activity during that period. US deal remain bright for the remainder of 2014. The M&A volume is up 65 per cent for the first nine months market has been resilient despite recent areas of of the year. Some commentators believe that 2014 geopolitical instability and significant economies may conclude with the most activity ever in the US. such as the eurozone and China showing signs of European M&A volume is up 27 per cent for the first weakness. A growing economy in the US and a three quarters of 2014 compared with 2013; the Asia- lack of volatility in global equity markets, together Pacific region is up 24 per cent in that same period. with a general availability of debt, have combined One driver of activity involving US companies, to provide a favourable climate for significant which has had beneficial effects as well for non- M&A transactions. However, should any of these US, particularly European, activity, has been the negative factors begin to adversely affect investing increase in what are popularly known as ‘inversion’ behaviour, or the positive factors begin to shift, transactions. Transactions characterised as global M&A activity may begin to slow down. One inversions generally involve a US-incorporated sign of caution may be that although the value of company acquiring a non-US-incorporated worldwide M&A transactions is up significantly, the company, but structuring the transaction so that the number of transactions is up only very slightly. A non-US entity is the survivor of the combination. record number of large transactions may be taking The result is typically the overall tax rate of the place, but the number of smaller and mid-market earnings of the US party to the transaction is transactions through the first nine months of 2014 reduced and cash held outside the US by the are only marginally greater than those in 2013. So US company can be more readily used without euphoria has not swept through every level of the subjecting that cash to US taxation. Although M&A market. We will have to see whether this transactions structured in this manner have taken means there is another area where there will be an place regularly over the past decade, they greatly increase in activity or whether this is a sign that the increased in number over the past year as the overall spike in volume will be relatively short-lived. GTDT: Market Intelligence – M&A 3 M&A IN AFRICA – A REGIONAL OVERVIEW Gavin Davies AFRICA M&A IN A REGIONAL OVERVIEW Gavin Davies and Hubert Segain are Gavin also advises the government partners at Herbert Smith Freehills, a of Sierra Leone on a pro bono basis. firm which has acted on numerous He is recommended in Legal 500, matters throughout the African Chambers and Who’s Who Legal for continent over the past three decades. his international M&A work. Based at Herbert Smith Freehills’ Hubert heads the firm’s Paris office. London office, with over 20 years’ He has extensive experience in public experience of a wide range of cross- and private M&A, joint ventures and border deals and advisory work, capital markets transactions. Hubert has Gavin acts for corporates and financial advised a large number of international buyers in Europe and Asia, as well corporates and banks on their M&A as in Africa, where as part of the transactions in France and abroad firm’s Africa team he has worked (and in particular in Africa). Chambers on agribusiness, consumer, energy, Global, Legal 500 and Who’s Who industrial and telecoms deals across Legal list him as a leading corporate the continent. lawyer. 4 www.gettingthedealthrough.com M&A IN AFRICA – A REGIONAL OVERVIEW “The message that conflict and commerce do not mix well has hit home with many political regimes in Africa.” k c o kst n hi T / c dis o ot h P o: ot h P GTDT: What trends are you seeing in overall all combine to present an increasingly appealing activity levels for mergers and acquisitions picture for M&A investment opportunity across during the last year or so? Africa, especially in sub-Saharan Africa. The growth of consumer-driven markets has Gavin Davies & Hubert Segain: M&A activity in also played a key role in the Africa success story. Africa has demonstrated year-on-year growth since According to the African Development Bank, Africa 2012 and we expect this growth to continue and for now has the fastest-growing middle class in the M&A activity in Africa to intensify, at least in the world and by 2060 it is envisaged that the number short to medium term. There are several key factors of middle-class Africans will grow to 1.1 billion. that suggest a buoyant future for M&A in Africa. The growth of these consumer-driven markets, The message that conflict and commerce do not which seems likely to continue as the middle class mix well has hit home with many political regimes expands, is expected to open up new frontiers for in Africa, which have taken active steps to reduce regional and foreign investment in these sectors, in political instability and the damaging consequences turn giving rise to increased levels of joint venture of such instability on foreign investment and and M&A activity. commerce generally. The desire to deliver peaceful M&A activity in Africa will no doubt continue to governance and procure peaceful transitions of be influenced by the relation of Africa’s developing power is especially important at a time when the economies with the BRICS countries (Brazil, Russia, global spotlight shines on Africa. Largely peaceful India, China, and of course South Africa itself), recent elections in Kenya, Ghana and Senegal are which are driven to continue to invest in Africa testament to such change in attitude and willingness as a result of their appetite for the continent’s to ensure a peaceful transition. natural resources, Africa’s large and untapped In many African countries, prudent agricultural sector as well as the opportunity to macroeconomic policies have also provided a sound tap into Africa’s ever-increasing consumer base foundation for investment and have increasingly (its growing middle class). On the other side of freed people from the impoverishing effects of the trade divide, African countries are mindful inflation. Privatisation programmes (such as the of the importance of trade and investment with privatisation of the Nigerian power sector), lower BRICS as a channel to economic growth, poverty corporate taxes (through provision of corporate alleviation and development, and most African income tax holidays and reductions from the countries are making efforts to create an enabling standard rate for taxes such as import duties and bilateral trading environment in order to make their VAT for large infrastructure projects), reductions exports more attractive. As a result, we expect to in trade barriers and improving judicial systems see continued growth in trade relations between GTDT: Market Intelligence – M&A 5 M&A IN AFRICA – A REGIONAL OVERVIEW Africa and the BRICS countries and consequently recently announced a commitment to jointly invest increased inward M&A activity. up to $5 billion over the next five years in energy We also expect to see continued interest infrastructure projects across sub-Saharan Africa in Africa from traditional European investors with a particular emphasis on power, transmission (including the UK, Germany and France) as and pipeline projects. European multinationals seek to counter limited Agriculture is another well-established European growth potential with African expansion. cornerstone of foreign investment in Africa. For Africa’s current position as poster-child for example, in early 2013 the Carlyle Group made emerging market investment has also put the its maiden foray into the African market (through continent on the investor map for North American its new sub-Saharan Africa fund) in one of the investors seeking opportunities outside the crowded bigger private equity investments in recent years, markets of North America and Europe. as part of a consortium that injected $210 million In addition to inward M&A activity from into the Export Trading Group, a Tanzania-based investors outside Africa, we also expect to see an agricultural company that sources commodities increase in regional M&A activity. In East and from Africa’s small farmers and sells those goods to Central Africa, the mining sector has been the main China, India and elsewhere. Following the Carlyle sector for regional M&A activity in recent years, Group’s entry into the African market, New York- but sectors including financial services, energy, based KKR Group recently sealed its first deal in the and telecommunications have also seen increased African market through its $200 million investment pan-African deal activity. Primarily in regulated in Afriflora, a company that grows about 730 million sectors such as financial services, insurance and flowers a year in Ethiopia for export to Europe. telecommunications, we expect to see further In addition to investment in natural consolidation among various industry players across resources, power and infrastructure, increased key sectors as they bid to meet their respective economic activity has been demonstrated in regulatory requirements (for example, in relation to telecommunications, banking and, most recently of minimum capital requirements) or otherwise look all (and for reasons already discussed), consumer at pan-African consolidation as a means for entry goods. into new markets or competing with more dominant According to a recent report by consultant players in the market. Analysys Mason, the telecoms market will be one of sub-Saharan Africa’s key growth sectors GTDT: Which sectors have been particularly in the next five years thanks to an increase in 3G active or stagnant? What are the underlying coverage and capacity and the wide penetration reasons for these activity levels? of low-cost smartphones. Additionally, the launch of a handful of key submarine cables around the GD & HS: Africa’s huge mineral and hydrocarbon African contour has triggered a rapid price drop deposits have historically attracted international and improved availability of data services to the oil and gas, and mining, groups. Persistently high end-user. Furthermore, the absence of traditional commodity prices in recent years have also resulted banking solutions for the unbanked rural population in renewed demand for Africa’s abundant natural in much of Africa has been capitalised upon by resources. several telecommunication service providers, which Power and infrastructure have also become seek to add mobile money transfer services to the a key investment sector and are both an bundle of voice and data services provided to end- opportunity for foreign investors and an essential users. Growth in the telecoms towers industry also ingredient in the continued development of continues to be robust, underpinned by telecoms many African countries. In 2012, there were operators looking to reduce exposure to costly over 800 infrastructure projects under way infrastructure in the region as well as the growing in Africa, amounting to over $700 billion in demand for 3G and 4G data, which is driving investment, according to Ernst & Young. Interest the need for significant additional infrastructure in infrastructure investments seems only likely to capacity across the African continent. grow, with recent figures from the Commonwealth With respect to the banking and financial Business Council showing an average 15 to 20 per services sector, industry opinion remains that cent return on investments in African infrastructure sub-Saharan African financial and banking systems projects across all sectors. Investor commitment and remain underdeveloped and that the relatively appetite in the African power sector is demonstrated stable macroeconomic and financial environment by two recent developments. In 2013, President of sub-Saharan Africa, together with the current Obama launched the Power Africa initiative, which reform momentum and expected strong growth, intends to facilitate the development of 30,000 only bodes well for the growth of the banking megawatts of cleaner, more efficient electricity industry in Africa. Industry experts envisage that generation capacity in sub-Saharan Africa. with the recovery of eurozone banks the next 12 to Additionally, Blackstone and Dangote Industries 18 months will bring increased investment activity 6 www.gettingthedealthrough.com M&A IN AFRICA – A REGIONAL OVERVIEW in the banking and financial services sector, with insurance and banking appearing to be the most likely areas for big deals, especially in South Africa. Interest in the African banking and financial services sector has especially spiked since the entry into the market of Bob Diamond’s nascent African banking venture, Atlas Mara, which recently invested $270 million for a 20 per cent stake in Union Bank of Nigeria. GTDT: What were the recent keynote deals? What made them so significant? GD & HS: In addition to the deals we have already mentioned, there have been several other keynote deals in Africa in the past 12 to 18 months. Three of the biggest M&A deals have been through acquisitions by Chinese companies in the African energy, mining and utilities sector. China National Petroleum Corporation (CNPC) recently acquired a 28.57 per cent stake in Eni East Africa SpA for $4.2 billion, providing it with an indirect 20 per cent stake in Mozambique’s Area 4 gas field. This transaction marked the largest investment from a Chinese company in an overseas natural gas field to date, and is one of the largest investments by a Chinese company into Africa. The past year has also seen a US$150 million Hubert Segain investment in Seven Energy, an oil and gas group based in Nigeria. The transaction marked a growing trend towards sovereign wealth fund investment in sectors in Africa that were historically dominated by more traditional private equity houses. “In addition to In February 2013, Nigeria officially handed over legal control of 15 state-owned electricity investment in natural companies to their new owners, capping a $2.5 billion privatisation process. The privatisation is regarded by many as the largest development in the power resources, power sector of Nigeria to date and establishes a framework that will allow for substantial investments to be and infrastructure, made into the Nigerian power sector to increase generation capacity, and expand the capacity of transmission and distribution networks. increased economic As we have mentioned, the consumer goods market continues to attract interest from foreign investors: Godrej Consumer Products recently activity has been acquired a stake in the Darling Group’s artificial hair production and distribution businesses in a number demonstrated in of African countries, and Danone, in partnership with the Abraaj Group, recently acquired Fan Milk International, a leading manufacturer and telecommunications, distributor of frozen dairy products and juices operating in West Africa. banking and, most Investor interest in the telecoms sector in Africa is demonstrated by Etisalat’s recent $5.7 billion acquisition of Vivendi SA’s controlling stake in recently of all, Maroc Telecom and a number of telecom tower portfolio acquisitions across the continent. The banking sector in Africa has also seen consumer goods.” increased interest from the Middle East, with banks GTDT: Market Intelligence – M&A 7 M&A IN AFRICA – A REGIONAL OVERVIEW in the region looking to establish or broaden their notification requirements for the COMESA regime footprint in Africa. Most recently, Qatar National are unusually broad and very easily triggered and Bank bought a 12.5 per cent stake in Ecobank for a when entering into a notifiable transaction the reported $200 million. This was the Qatari lender’s filing costs will potentially be significant. Following second African purchase in the past two years. In the first round of applications made to the CCC March 2013, it bought Société Générale’s Egyptian pursuant to the COMESA regime, in August 2013 the business for $2 billion and the bank is also present in CCC announced (through the publication of terms Libya, Mauritania, South Sudan, Sudan and Tunisia. of reference and a request for proposal from a team of experts) its intention to conduct a full review of GTDT: How has the legal and regulatory the existing CCC regulations on merger control landscape for mergers and acquisitions changed and it is hoped that such a review will result in the during the past few years? adoption of revised regulations that strike a fair balance between protection of regional economies GD & HS: A challenge that many foreign investors from economic concentrations and anti-competitive may face with Africa, and one they may not have behaviour and the need to ensure the existence of encountered elsewhere, is that of local content and a conducive and non-inhibitive environment for indigenisation requirements. These requirements facilitating foreign investment. (the most well-known of which are perhaps the economic empowerment rules in South Africa and GTDT: Are there factors that may temper the Zimbabwe) are many and varied, but are intended to envisaged growth in M&A activity levels across assure a degree of local exposure to foreign-owned Africa? or operated ventures, and to assuage concerns that foreign activity is not bringing benefits to the GD & HS: For all the optimism surrounding the local area. Local content rules can pose challenges economic growth recorded and potential for further in sourcing partners and personnel with suitable growth that has been discussed so far, there is qualifications and experience, and material and an inverse cautionary tale to be told. Africa may service providers with sufficiently high standards. be on the right track, but this is the proverbial Local content requirements may also affect the marathon and continuous efforts are required to structure of an M&A deal, with transactions more tackle poverty, epidemics, corruption, inadequate likely to be executed as joint ventures or staged infrastructure and political instability to ensure that investments rather than 100 per cent acquisitions. Africa does indeed fulfil its limitless potential. Difficulty in taking effective security in many Africa is often referred to as a whole, but each African jurisdictions presents a challenge for of its 54 nations has a different legal system, and financing M&A transactions. It is often legally there are more than 2,000 native languages as impossible to take a comprehensive security well as Arabic, English, French, Portuguese and package and therefore it is important to assess Spanish. This rich diversity is a barrier to foreign what is possible to secure and compare this with investment in sectors requiring scale for bankable market practice for international financings. In a returns achievable only on a cross-border, regional number of jurisdictions, the growing trend for the basis. Legal systems in Africa are rooted either in harmonisation of commercial law in the region, civil law or common law and in certain countries such as the Organisation for the Harmonisation of these systems operate alongside shariah law and Business Law in Africa (OHADA), has assisted in tribal or customary laws. Lack of certainty is a establishing market norms for local security issues, feature affecting many local legal systems, driven however there remain blanket prohibitions on the by inconsistent court interpretations, a shortage of giving of ‘financial assistance’ by a target or any precedents and unreliable public registers. Local of its subsidiaries for the acquisition of its shares market practice may also differ significantly from in many jurisdictions in Africa. Therefore, the international market practice. Local law remains an granting of security over the assets of the target in essential part of every M&A deal in Africa. Certain support of acquisition financing is unlawful in many elements of local law, such as tax, employment, jurisdictions. company and insolvency law, cannot be avoided. Merger control analysis is fast becoming a key These factors combine to make for a legal landscape aspect of transaction planning for acquisitions and that may be unfamiliar and complex to navigate for joint ventures in emerging markets, and this is no foreign investors. different in sub-Saharan Africa especially following African governments are increasingly alive to the introduction of the supranational COMESA the drag on investment caused by the diversity of competition regime in January 2013. Under the national rules affecting foreign investment, and COMESA regime any merger or acquisition (very a gradual trend towards regionalisation has been broadly defined under the relevant regulations) emerging for some years. The work of supranational requires a notification to the COMESA Competition bodies such as OHADA and COMESA is beginning Commission (CCC) to be made. The merger to harmonise some of the rules affecting foreign 8 www.gettingthedealthrough.com M&A IN AFRICA – A REGIONAL OVERVIEW investment in the hope that the negative effects of GTDT: What does the future hold? What activity national divergence can be eliminated over time; levels do you expect for the next year? Which however, as we have discussed, such attempts at sectors will be the most active? harmonisation are not without their own difficulties. The recent Ebola outbreak in West Africa GD & HS: As investors deal with economic and the challenges for the relevant governments slowdown in developed economies, they continue to to contain it has visibly had an impact on the look to more significant growth opportunities in new economies of Sierra Leone, Guinea and Liberia. The emerging and frontier markets, and are prepared to crisis has had an adverse effect on labour availability address the associated higher investment risk. The and capacity, which in turn, for economies that ‘Africa rising’ story of rapidly expanding consumer are largely dependent on the agriculture sector for goods markets, and similar attractive opportunities economic growth, has resulted in a downturn in in related sectors such as financial services and economic growth since the outbreak. The world’s telecommunications, is a growing area of focus largest steelmaker ArcelorMittal has seen work for many such investors. As a result, we expect big disrupted on its iron ore mine expansion project in opportunities for business to continue to emanate Yekepa in Liberia after contractors declared ‘force from Africa and result in increased inbound and majeure’ and moved people out of the country. regional M&A activity, with significant interest in Similar disruptions have also been experienced the ever-expanding consumer goods market as well by Vale and Rio Tinto in their iron ore mines in as keen interest from investors in sectors such as Simandou in the forests of eastern Guinea. financial services and telecommunications. The sustained growth of many economies The ongoing exploration and development of in Africa is also dependent on the continued natural resources should see increased interest willingness of governments in Africa to strike a in the development of infrastructure as both fair balance between a regulatory and economic governments and private-sector participants seek to framework that is conducive to foreign investment develop infrastructure to allow for the exploitation but at the same time protects local interests. For of natural resources and transportation of upstream example, although Ethiopia should be commended products to market. for the steps taken in adopting and implementing Increased investor activity is also expected in its Growth and Transformation Plan (2010), the power sector as governments seek to implement commentators have expressed concern about large-scale power generation, distribution the level of protectionism that remains in areas and transmission projects to provide a stable such as banking, retail, telecommunications and backbone of power for domestic and commercial transportation. consumption. “The ‘Africa rising’ story of rapidly expanding consumer goods markets, and similar attractive opportunities in related sectors such as financial services and k c o kst telecommunications, is a growing n hi T / k c o /iSt area of focus for many investors.” b e ej er d o: ot h P GTDT: Market Intelligence – M&A 9
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