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Iberia M&A trends: Full year report for 2021
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Iberia M&A trends: Full year report for 2021

emea M&A

Brought to you by the M&A Community in association with MergerMarket. 

Industrials and chemicals lead the way in a post-Covid surge supported by a resilient tourist industry and undervalued assets.

Spain and Portugal’s economies were particularly affected by the impact of Covid-19 on their travel and tourism sectors. Spain’s economy shrank by 10.8% over the course of 2020, while Portugal’s GDP contracted by 8.4%, according to the IMF.

In common with other major economies, after a significant drop in the number of M&A deals in 2020, the end of 2021 saw a resurgence and a record number of transactions.

Led by industrials and chemicals, which posted the highest value of any sector in the region, Iberia’s strengths in renewables attracted considerable attention to the energy sector. 

While there is still a question mark over the effect of the Omicron variant, we expect the renewed enthusiasm for deals to continue. There is an exceptionally large amount of capital in the market and the key drivers of deals are energy transition, digitalization, and turnaround activity for distressed firms. Compared with other regions, assets in Iberia are undervalued which can only encourage overseas investment. 

Spain’s GDP is expected to show growth of 5.7% for 2021 (above the EU average) and Portugal, the smaller of the two economies is predicted a more moderate 4.4%. The number of deals in Iberia was up by 29% with 715 transactions – the highest since 2006. Value also rose year on year. 

Private Equity buyouts saw a massive increase – 72% in value and 24% volume. But exits dropped in value, despite a rise in the number of deals. This may be due to PE firms being under pressure to invest their large amounts of capital.

The energy transition was a major motivator for deals in 2021 – in one of the largest renewable energy deals of the year, Spain’s Iberdrola and the Qatar Investment Authority jointly took a 20.1% stake in US-based AVANGRID for €3.3bn. At home, the Australian investment firm IFM took a 10.83% stake in Naturgy, a company that has been investing heavily in solar and wind energy both in Spain and abroad. 

The energy, mining and utilities sector saw €12.1bn in deal value in 2021, making it the second largest sector by M&A value (20.6%).

The economic recovery boosted deal activity in the leisure sector. This was especially significant for Iberia since travel and tourism contributed 17.1% to Portugal’s GPD and 14.1% to Spain’s in 2019, according to the World Travel and Tourism Council. The leisure sector saw M&A value increase almost eightfold and the number of deals also rose. 

The IMF’s projected annual growth rates for 2022 were 6.4% for Spain and 5.1% for Portugal. That was before the spread of the Omicron variant but dealmakers are unflustered: high vaccination rates and cross-EU co-operation on vaccine passports, plus a demonstrably resilient tourist industry mean that Spain and Portugal are expected to cope easily with any future pandemic restrictions.


The pandemic is more or less over. High levels of capital, low interest rates, and assets with long-term growth potential will continue to be a draw, with big opportunities in the energy sector, especially for PE.

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