The Kenyan economy ordinarily takes a dip every five years as businesses hold back awaiting the outcome of the elections.
A law firm has forecast increased mergers and acquisitions this year despite jitters ahead of the August 8 elections.
Intense competition by global players and demand for experts and experienced personnel will be some of the key drivers of the mergers according to Bernard Musyoka, partner and an expert in the field at MMC Law Africa.
“It is expected that the upward trend on the number of mergers and acquisitions in Kenya and in the region shall continue,” he said.
“However, this is also subject to certain enabling factors such as stability, especially following the General Election that is coming up in August and a friendly regulatory environment.”
The economy ordinarily takes a dip every five years as businesses hold back awaiting the outcome of the elections.
Mr Musyoka said this year the market will see more equity transactions in financial services, information, and communication technology, renewable energy and education sectors.
Over the past few years, multinationals have been picking Kenya and local firms as a launch-pad into Africa, with the strategic location in the region being a major pull factor.
“To stay competitive, such businesses need, among others, a strong capital base, hence are more susceptible to mergers in search of capital injections,” said Mr Musyoka.
He noted the 2007 post-election violence resulted in a drop in the number of mergers and acquisitions in Kenya.
However, after conducting peaceful elections in 2013, the mergers and acquisitions market became vibrant once again.
A I&M Burbidge Capital report showed Kenya accounted for 72 of the 107 regional transactions completed in 2016.
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