The first three months have been quite disappointing in terms of M&A activity here in Latvia, with the main news being related to completing the transactions announced already last year.

Thus, one of the Jumbo deals that had been announced in 2014 closed the other week. The Norwegian Orkla has now become the sole shareholder of Latvian confectionery legends Laima and Staburadze, for a consideration of what we believe may amount to close to EUR 100 million (more on this transaction in our earlier report here.)

The other major transaction of 2014, the acquisition of controlling interest in Citadele banka AS from the Latvian Government by a group of investors led by Ripplewood Advisers, is still to be completed. According to public sources the closing was originally expected to take place by the end of this quarter, but it appears that the buyers are still working on obtaining the necessary approvals from regulators in the different jurisdictions the bank operates under. A possibility that the deal might fail to close for any reason whatsoever is too apocalyptic to even speculate about because of the political fall-out it might cause here in Latvia. We can probably expect seeing the completion of this transaction in the coming weeks.

One of the most mysterious transactions of 2014, the announced exit of German E.ON Ruhrgas from Latvijas Gaze AS, the gas transmission and distribution company, has been on and off the public agenda over the recent months (more on that here and here). This matter gained a new momentum a few weeks ago when the Government declared that it had identified an “acceptable party” to make the bid for E.ON shares and that the Government itself would not step in as a buyer of Latvijas Gaze shares. While the identity of the potential investor was not formally revealed, the media has pointed at the Luxembourg-based 2020 European Fund for Energy, Climate Change and Infrastructure as a possible suitor.

While the M&A market remained stagnant and quiet, some buzz was generated by the startup community which manifested itself both at the TechChill conference in February and at the SeedForum in March. Labs of Latvia, an Internet-based startup community platform, was launched earlier this month with financial support from Latvia Guarantee Agency, the fund of funds, to report on the startup news in Latvia.

Today’s startups are likely to dominate the acquisitions scene in the years to come. But, unless the M&A activity picks up remarkably in the spring months, we might be well on our way towards seeing a very disappointing first half of 2015 indeed.


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Līdz 2020.gadam Latvijas uzņēmējiem biznesa attīstībai būs pieejami papildu 200 miljoni eiro privātā un riska kapitāla finansējuma
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