PH M&A deals surged 29.9% in 2024 on infra, energy push
Signage appears on the Australian head office building of PricewaterhouseCoopers in Sydney, Monday, June 26, 2023. —File photo from the Associated Press
MANILA, Philippines — The push for green energy transition, coupled with an aggressive infrastructure development pipeline, caused a 29.9-percent surge in merger and acquisition (M&A) deals in the Philippines in 2024, with more deals seen this year due to more investor-friendly policies.
PwC Philippines’ Year-End M&A Report 2024 showed that there were 113 M&A deals in the country last year, up from 87 in 2023.
These were valued at $8.6 billion overall, representing a 36.9-percent jump.
The energy and natural resources sector accounted for 18.6 percent of the total deal volume, followed by financial services at 15 percent, technology at 14.2 percent, and consumer and retail at 12.4 percent.
“Regulatory reforms, such as the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act, have introduced tax incentives and encouraged foreign investment in the energy and telecommunications sectors,” PwC noted in its report.
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According to PwC, the energy and natural resources sector brought in $3.7 billion in M&A deals spanning 21 significant transactions last year, driven mostly by investments in solar and wind projects.
Among the largest was Meralco PowerGen Corp.’s and Aboitiz Power Corp.’s acquisition of “multiple power plants” for $2.2 billion, highlighting the need to expand generation capacity and meet rising energy demand.
At the same time, the real estate (eight deals) and technology (16 deals) sectors each contributed $1.1 billion amid an increasing need for urbanization and data centers, PwC said.
On the financial services side, the Bangko Sentral ng Pilipinas’ push to digitize 50 percent of transactions by this year allowed the sector to attract 17 M&A deals worth $908.2 million.
Ayala-backed Globe FinTech Innovation Inc.’s deal with Japan’s Mitsubishi UFJ Financial Group to inject more capital into e-wallet GCash was among the key transactions for the sector.
Beyond 2024, PwC said “new infrastructure projects, advancements in telecommunications and a shift toward environmentally friendly energy sources are set to drive the country’s growth.”
PwC cited the CREATE MORE (Maximize Opportunities for Reinvigorating the Economy) Act signed on Nov. 11, 2024, as a key policy that would encourage more foreign participation in various sectors, including energy and telecommunications, and position the country “as a hot spot for thriving M&A activity.”
“This environment offers exciting opportunities for strategic partnerships and success, particularly in sectors like renewable energy, real estate, technology and financial services,” it added.
Increased activity
China Bank Capital Corp. managing director Juan Paolo Colet said he expects increased activity this year due to factors such as a favorable economic outlook for the Philippines.
“Sectors that could see increased dealmaking include energy, infrastructure, health care, technology, consumer, finance and leisure,” he added.
Rizal Commercial Banking Corp. chief economist Michael Ricafort shared the sentiment, stressing that the Philippines is among the fastest-growing economies in Asean (Association of Southeast Asian Nations) or Asia with favorable economic fundamentals and demographics that should attract increased investments.
To help the M&A scene grow, Ricafort suggests that the government address high electricity costs, and to take full advantage of CREATE MORE to entice more job-generating investments into the country.
