Infrastructure deals set to boom
This year is expected to be a record year for transport infrastructure deals which have risen sharply since the beginning of the year, according to an analysis by global advisory company KPMG.
The report reveals that the first half of 2013 saw global deals of infrastructure assets (including ports, airports and road operations) worth US$16.6bn.
By the end of the third quarter, this had risen to US$23.5bn, which already exceeds total annual deal values for every year since 2008, according to KPMG.
Steffen Wagner, European head, transport M&A, KPMG, said: “There are three main drivers behind this trend: Public budget restraints across debt ridden countries especially in Europe have forced national governments to privatise national infrastructure and look for private operators and investors in order to secure the operation of strategic transport infrastructure and hub networks.”
“Secondly, private investors are constantly looking for investment opportunities with steady cash flows and growth prospects and transport infrastructure targets, including ports and airports, can offer these opportunities.”
“Thirdly, strategic investors are increasingly investing in infrastructure assets, especially in emerging markets where growth forecasts are significantly above the mature markets in Western Europe and North America,” he added.
Most assets being acquired in 2013 have either been in Europe or Asia.
KPMG says with transaction multiples high, public budgets low and growth prospects steady, M&A in transport infrastructure is expected to remain high on the sector’s agenda.
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