Turkey M&A Market: Overcoming Troubles

The annual Turkish M&A Review report published by Deloitte had shown that M&A figure had decreased, and experts at Cigdemtekin Dora Cakirca Aranci stated it has been a rocky road for Turkey, which has resulted in a decrease of financial investment activity. 

“Political uncertainty and security problems in the Middle East remain unimproved in the past year continuing to negatively impact Turkey and Turkish economy.  In addition to these geopolitical factors Turkey also suffered from the attempted coup and the sequential elections leaving the political and economic environment uncertain for investors.

“There were also some other factors which had a global impact such as UK’s Brexit. All these factors negatively affected the appetite of the investors,” explains Gamze Çiğdemtekin. In this insightful interview, they share how Turkey is recovering, and what they hope will come in the following years to further develop their international investment scope.

How has the M&A field changed in Turkey over the past few years?

Turkey is an emerging market with great growth potential, making the country an attractive market for many foreign investors, and is a commercial hub and a doorway at the crossroads between Europe, Middle East and Asia. In the past few years the global and regional economic agenda was dominated by political and security concerns. Like in many EU countries, Turkey has been negatively impacted by political uncertainty and security problems in the Middle East and the worsening refugee crisis. Terror incidents and an attempted coup were among the other factors affecting the domestic M&A activity.

In the past few years, small and middle market transactions dominated the overall M&A activity by deal number; foreign investors’ deal volume and privatisation deal volume were at one of their lowest levels in the past decade, and private equity activity was limited. Private equity firms were rather cautious in making new investments; nevertheless, we observed certain successful fund-raising activities as well as considerable number of exits.

The investor type remained diverse and we observed investments from financial investors with the involvement of development banks, venture capital firms, investment holdings, family investments, angel investors and private equity funds in various transaction.

We do not expect a significant change in the behavior of the investors, although we believe that, especially strategic investors, will remain keen on exploring investment opportunities, relying on the long term potential of the Turkish market.


What restricts Turkey’s growth in investment? What do you pose should be done to overcome this?

2016 and most of 2017 involved macroeconomic risks driven by geopolitical developments in the region, attempted coup, as well as the sequential elections in Turkey.  Although some of these geopolitical risks remain unimproved, we believe that the political and economic environment will now stabilise and improve after having recovered from the attempted coup in the past year and the clearance of the uncertainty caused by the sequential elections. Also Turkish government is now focused on some of the major economic reforms that has long been on their agenda which was disrupted with aforementioned events, and these efforts started to show its first signs of recovery increasing the growth rate to %5 in the first half of 2017.  Despite the crisis between the EU and Turkey in the past few months, which is believed to have been mainly driven by the internal politics and elections on both sides, now that the elections are over, the parties should look into and find ways to stabilise the EU and Turkey relationship and pave the way for Turkey to continue the candidacy negotiations and political and economic reforms. Regardless of whether Turkey eventually becomes an EU member, it is not always the destination but the journey from which Turkey will greatly benefit from for, among many others, attracting more foreign investment.


How do you ensure that the deals you are advising run as smooth as possible?

CDCA is rather young firm established by highly experienced founders who had worked in a number of international law firms and multinational companies in Turkey and abroad.  Our team’s M&A experience is incomparable to many other local and international law firms, given the number and diversity of deals that our partners have had handled over the past two decades.  This diversified experience brings about a strong legal background and a sound capability in handling the complex matters smoothly with a solution oriented approach. We first try to understand the business expectations and concerns of our client, as well as the counter party, and offer solutions that will help the deal happen with the best possible result for our clients. We also understand the local cultural background of Turkish business environment, as well as the requirements of a cross border M&A deal that requires the international standards. Our work could sometimes extend to making sure that our client understands these dynamics and follows a strategy accordingly which we believe is key to achieving g a successful result.


What main challenges do you face during financial transactions and how do you overcome this?

Some of the transactions could involve a structure that emerges from a different jurisdiction in which you could find a sound, legal infrastructure to support and allow for such structure, but which the local law may not necessarily support. In most of those circumstances we mimic those structures with the tools that are legally available under the local law and create hybrid models.


What predictions do you see for the upcoming year?

Having past the mist of the elections and the immediate shock of the attempted coup, we expect a stabilised and normalised political and economic environment in Turkey which will hopefully bring the number of deals, as well as the deal values, to higher figures as compared to last few years.  The Turkish government now directs its priority and focus on the economic reforms that has been on their agenda for a long time, and these efforts started to show its early signs of recovery by number of activity in the growth rate as well as the number of activity in the M&A.  If the Government continues to be keen on these reforms this will greatly help in boosting these figures significantly.


Gamze Çiğdemtekin




Tuna Çakırca





Gamze Çiğdemtekin is a leading corporate and M&A lawyer in Turkey advising major international and Turkish clients in several sectors, including energy, banking and insurance, manufacturing, cements, chemicals and pharmaceuticals. Her expertise includes advising on a wide range of corporate and finance transactions with a particular focus on M&A, private equity, energy projects and competition law. She is ranked as a leading M&A lawyer in Turkey by several law directories such as Legal500, Chambers & Partners (Band 2).

 Tuna Çakırca has extensive experience including M&A/corporate and capital markets work. Her M&A experience includes representation of both sell and buy side clients in a wide range of sectors. She has also represented underwriters, issuers and/or selling shareholders, most recently for electricity and telecommunications companies. Additionally, she has extensive experience in representing foreign and local companies in connection with their corporate, commercial, regulatory, employment and real estate matters. She continues to assist many multinational companies in their day-to-day businesses in such areas.


Çiğdemtekin Dora Çakırca Arancı (CDCA) is a full-service law firm with offices in İstanbul and Ankara. The firm offers specialized legal advice to international and local corporations, financial institutions and investors operating in a broad range of industries.

We are committed to assist clients with practical solutions to reach their business goals. We achieve this by closely monitoring legislation, case law and administrative practice, while thoroughly considering our client’s business priorities.

We handle all client matters and transactions in an efficient, responsive and timely manner. With our knowledge, experience and strong network, we ensure all legal matters smoothly move forward.

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