Number of Mergers and Acquisitions in Greece Considerably Declines

The number and the volume of mergers and acquisitions (M&A) in Greece are declining considerably. In 2008, there were 153 M&A transactions with a value of seven billion euros. In 2009, however, the number of transaction has declined to 102 and the volume has decreased to four billion euros. These are the findings of a survey conducted by the Centre for European Economic Research (ZEW). The survey is based on the Zephyr database by Bureau van Dijk (BvD), which includes detailed information on mergers and acquisitions worldwide.

A turnaround on the Greek M&A market in 2010 is not very likely due to Greece’s desolate budget situation. It is uncertain how much direct investments of Greek firms will be affected from the cost-cutting programme announced by the Greek government.

Almost one quarter of M&A transactions conducted by Greek investors between 1999 and 2009 took place in the finance sector. Acquisitions of foreign banks by Greek banks accounted for one quarter of that number. Even at the time when global banks were involved in the financial crisis, the Greek banking sector was not affected. With the exception of the TT Hellenic Postbank, none of the Greek banks had invested in subprime products. They did not have to face liquidity problems because in Greek the relation between deposits and loans is very high. Therefore, the Greek banks were able to further expand in 2008 and continued investing in their own branch networks or acquisitions of other banks in other countries. As a consequence of M&A activities in the last ten years, Greek banks are now doing business in Russia, Poland, Ukraine, Turkey and Egypt. Greek Banks have built a network of about 4,000 branches in these countries.

Outside of the banking sector, M&A transactions in Greece are dominated by the vast number of acquisitions of production and bottling companies of non-alcoholic beverages by Coca-Cola Hellenic Bottling Company SA. Coca-Cola Hellenic has derived from a merger of Hellenic Bottling Company, Athens, and Coca-Cola Beverages, London, in 2000. It holds bottling and distribution rights of The Coca-Cola Company in 28 countries. Until 2008, the company mainly focused on external growth and bought up many local market leaders in countries like Russia, Italy, Bulgaria and Romania.

For further information please contact

Dr. Mariela Borell, Phone: +49 (0)621/1235-144, E-mail: borell@zew.de