Navigating Deals
Amidst Strong
Headwinds:
2023 Snapshot of Global M&A
Trends and Local Opportunities
January 2024
kpmg.com.cy
2
Document Classification: KPMG Public
©2024 KPMG Limited, a Cyprus limited liability company and a member firm of the KPMG global organization of independent member
firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
The current global and local M&A landscape
Hospitality and Tourism sector
Fattal Hotel Group, through Fattal Limassol Limited, acquired 100% of
Hawaii Hotels Limited
Notable deals in Cyprus 2023
Financial services
Eurobank increases its shareholding ownership of Hellenic Bank to
55,3% subject to the approval of the competent supervisory authorities
Global M&A activity
In 2023, the global M&A market has grown increasingly intricate due to stringent macroeconomic conditions and tight financing markets. This has led toadropoffin
global deal volume and value as well as extended deal timelines and heightened uncertainty in many cases.
However, despite these immediate macroeconomic challenges, we anticipate that the robust growth in Cyprus' M&A market will persist. Notably, we expect increased
activity in the energy sector, focusing on renewable energy and sustainability, as well as a surge in deals within the technology sector as businesses embrace digital
transformation and innovation. Additionally, sectors such as healthcare, FMCG, education, and hospitality are likely to experience heightened activity driven by changing
consumer demands, market consolidation, foreign interest, and globalization.
Furthermore, the approval of an action plan by the Cabinet of Ministers to incentivize M&A among small and medium-sized enterprises (SMEs) signals a more promising
future for businesses of all sizes.
Embracing Resilience and Innovation in a Shifting Economic Landscape
24%
22%
13%
9%
8%
7%
17%
Technology
Industrials
Consumer Cyclicals
Healthcare
Financials
Basic Materials
Various Other
Global volume of
deals, by sector
(YTD 2023)
Source: Refinitiv
Source: Refinitiv
Industrials
Halma acquired 100% of FirePro, a designer and manufacturer of
aerosol fire suppression systems.
Healthcare
ECM Partners acquired 68% of the share capital of Ygia Polyclinic
Private Hospital
43.971 43.977
56.979
46.388
40.666
0
20.000
40.000
60.000
€0
€2.000
€4.000
€6.000
2019 2020 2021 2022 2023
Number of Deals
Deal value (€' bn)
Number of Deals
Deal Value (€' bn)
3
Document Classification: KPMG Public
©2024 KPMG Limited, a Cyprus limited liability company and a member firm of the KPMG global organization of independent member
firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
Ministry of Finance ‘s action plan to promote M&A in Cyprus
Priority
Sectors
Integrated support framework and culture shift
• Action plan:
• Develop a focused communication strategy to
promote conferences, events, and successful
M&A, both domestically and internationally
• Creation of a new national entrepreneurship
policy with a focus on fostering a culture
conducive to promoting M&A
• Competent implementing body: Ministry of Energy,
Commerce and Industry (MECI)
• Implementation Timeline: 2024-2026
Modernisation of the legislative framework
• Action plan: Modernise the legislative framework based
on successful European models and simplify procedures
to reduce administrative burdens
• Competent implementing body: Ministry of Finance,
the MECI and the Department of Registrar of Companies
and Intellectual Property
• Implementation Timeline: 2024-2026
Access to finance and promotion of M&A
Action plan:
• Promoting subsidies for equipment and
machinery, particularly for sectors like
agriculture, manufacturing, and exports,
contingent on the successful completion of a
merger or acquisition
• Examining whether local banks are
interested in offering financial support,
including interest rate subsidies and financial
assistance, to support emerging businesses
after a merger
• Furthermore, the idea of providing specific
incentives to investors who fund specific
mergers or acquisitions is also being
explored
• Competent implementing body: Ministry of Energy,
Commerce and Industry
• Implementation Timeline: 2025-2027
Culture shift
Legislation
Finance
options
Source: Action plan for providing incentives to promote mergers and acquisitions, Ministry of Finance
In August 2023, the Cabinet of Ministers in Cyprus approved an action plan aimed at encouraging mergers and acquisitions (M&A) among small and medium-sized
enterprises (SMEs). This plan is part of the reforms endorsed by the European Commission as part of the Cyprus Recovery and Resilience Plan. The action plan
not only aims to provide incentives for M&A but also to simplify the legal framework and processes related to acquisitions and mergers. Additionally, it proposes to
reduce bureaucracy and administrative burdens and foster a culture of communication through various initiatives such as communication plans, seminars, and
showcasing best practices in the Cypriot and international business sectors.
Moreover, a new long-term development strategy for Cyprus, funded by the European Union and prepared by the Cyprus Council for Economic and
Competitiveness, outlines a vision for 2035. This strategy prioritizes enhancing the competitiveness and productivity of Cypriot businesses and emphasizes a shift
towards exports through digitalization and ongoing training. Achieving these goals necessitates the growth of larger businesses capable of adapting to evolving
market conditions within a globalized environment.
4
Document Classification: KPMG Public
©2024 KPMG Limited, a Cyprus limited liability company and a member firm of the KPMG global organization of independent member
firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
Selected deal opportunities promoted by KPMG in Cyprus
Selected deal opportunities
Target activity Description
Digital healthcare The shareholders of a company offering hybrid academically accredited degree programmes in Digital Healthcare, including B.Sc. and M.Sc., along
with professional development certified courses seeks funding to accelerate the growth of the company. The programmes and courses are delivered
through an exclusive platform with AI driven advanced analytics and tailored feedback for students, lecturers, and partner institutes.
HealthTech An innovative artificial intelligence medical cloud platform for delivering enhanced ECG services to healthcare professionals as well as individuals
globally is looking to raise capital to further develop the platform. The company is classified as an Innovative Company in Cyprus under the Deputy
Ministry of Research and Innovation.
Mechanical services The shareholders of a company in which main operating activities include the construction and management of mechanical, energy and oil & gas
projects are looking to exit the business. The company generated c. €1.5 million revenue in 2022 and has a 10 year successful track record in
completing projects in Cyprus and has also successfully completed projects on an international level namely in Greece, Germany and Denmark.
Retail / Home
Interiors
The shareholders of a well established and highly reputable interior design company based in Paphos that has been active in the Cyprus market for
over 20 years are looking to exit the business. The company generated c. €0.5 million revenue in 2022 and offers home interiors, room design, interior
design support as well as supply and fitting for clients and specializes in window dressings, soft furnishing fabrics and wallpapers .
Food production An emerging producer of gourmet and vegan packaged meals with Cypriot recipes is seeking equity and or bond funding to increase its production
capacity to meet client demand. The producer has secured agreements with points of sale which among other include food stores and large
supermarket chains.
Real estate The shareholders of an established hospitality group in Cyprus are seeking a joint venture partner for the development of 12 luxury residences which
will be internationally branded. The planned residences will have access to the services and facilities of the hospitality group that is situated on the
beachfront and adjacent to the residences.
The table below presents selected M&A and Investment opportunities which KPMG Limited is engaged to assist on the sell-side. The sample
consists of opportunities in various sectors of the local market and which the investment size is less than €5,0 million.
©2024 KPMG Limited, a Cyprus limited liability company and a member firm of the KPMG global organization of independent member firms
affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or
entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of
the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate
professional advice after a thorough examination of the particular situation.
The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organization.
kpmg.com.cy
Christophoros Anayiotos
Board Member
Deal Advisory
T: +357 22 20 92 92
Georgios Ioannou
Manager
Deal Advisory
T: +357 22 20 92 36
Contact us
