Право / 2.
Хозяйственное право
PhD student Aldabergenova Botakoz
Eurasian National
University after of L.N. Gumilyev, Kazakhstan
Mergers and acquisitions in Kazakhstan
Mergers and acquisitions, as one of the priorities
of the strategic business and its capitalization don’t currently lose their
relevance in the business world over a century. And if, 10-20 years ago, the
M&A transactions were as an instrument of companies’ expansion and one of
the most preferred forms of investment in the most economically developed
countries as USA, UK, France, Germany, etc., now developing countries also have
gradually began to get involved in the business cycle of the mergers and
acquisitions. This was primarily the result of world globalization’s process
and the expansion of the international companies which over the past 20 years
actively began to enter to the emerging markets of other countries and attain
competitive positions, both on local and world markets.
Thus, according to analysts, the number of the
M&A transactions worldwide over the past 10 years has increased more than
5,5 times. In accordance with some estimates, in the last decade more than 80%
of all international investments were spent not on the creation of new
industries, but on the assets’ acquisition of existing businesses.[1]
In Kazakhstan the concept of the
mergers and acquisitions has come due to the activity of foreign investors, particularly
from China, USA, India and Russia, who carefully began to enter into the Kazakh
market only in the last few years.
Despite the claims of Kazakh
financial analysts that the M&A market in Kazakhstan is currently a quite
active and the competition in Kazakh market today is high enough, a comparative
analysis of the global M&A market allows me to conclude that the M&A
market in Kazakhstan not only not active, but also it is not
sufficiently developed to be called as «market» in general.
Kazakh M&A transactions are
characterized by direct state influence on business processes in the country.
In connection with it, mainly M&A transactions there undertaken by major
national companies or companies holding a dominant position in the market. Despite
some activity of Kazakh companies to invest abroad and the acquisition of
foreign companies, yet a large proportion of the M&A in Kazakhstan, carried
out with the initiatives of the foreign companies.
Talking
about the main problems of the M&A in Kazakhstan, analysts point out the following
shortcomings:
1)
Informational secrecy of local companies. For business owners who want to sell
their assets, there is a great risk of information leakage. Therefore, this sort of the M&A
transaction business owners try to implement without the help of brokers or
financial and legal consultants that, for example, in the Western practice is
unacceptable.
About
the opacity of the M&A in Kazakhstan is demonstrated by the fact that
Kazakhstan has no one systematically tracks the market trends of the mergers
and acquisitions, and those analytical and statistical information, which
prepared by the audit and finance companies are not fully reflect the essence
of all M&A transactions in Kazakhstan, but focused primarily only on the
large M&A transactions;
2) Undeveloped stock market, because
companies are still not transparent and especially in part of their financial
reporting and decision-making. The developed stock market would help the
companies and potential investors determine the market value of the company;
3) The existence of a strong
affiliation of companies with financial-industrial groups, which leads to
reluctance to change the situation, lack of effective corporate governance;
4) Inadequate legislation.
Unfortunately, Kazakhstan today is not distinguished by the perfect legislation
that allows fully protect the rights of owners of private structures, as
evidenced the practice occurred, or trying to come of hostile takeovers and
raiders from the part of some individual companies, not without the participation of government agencies over the
last five years;
5) Lack of both theoretical and practical
experience of local companies in conducting the M&A;
6) Lack of professionals who can
professionally accompany the M&A transactions. Also, one of the problems of
the Kazakh practice of M&A is that many Kazakh companies, as a rule, do not
use the financial and legal professionals in the process of negotiating a
comprehensive test facility of the transaction and drafting the agreements,
thus creating a risk of inadequate risk assessment and management. The
integration of merged companies almost in all cases performed by staff members
of the companies, whereas in Europe and the United States the combined
companies had long begun to attract external experienced consultants involved
in the M&A process at the first stage in order to conduct a smooth integration
process;
7) Weak role of the antimonopoly
authority in the country which is not able to improve the competitiveness of
local companies and protect the rights of business owners and consumers.
Monopoly
or oligopoly in Kazakhstan, unfortunately, is not the object of reflection for
the competition authority of the country. This is evidenced by the activities
of known Kazakh monopolistic companies which control a larger fraction of their
market sectors, among which are the companies in the telecommunications,
transportation and shipping, banking, oil and gas, and mining and other
industries.
Thus,
summing up stated above, we can say that the M&A transactions, despite the common
mechanism for their realization, still have their differences and specificities,
depending on the legal and social systems of the countries where they operate.
However, as international practice shows, the majority of developing countries
are on the way to develop their economies in the same sequence as the developed
countries took place many years ago. One can only hope that Kazakhstan does not
need such a long way length in a century in order to repeat the economical experience of the
United States and Western Europe, no longer fall under the category «Third
World country» and enter in number if not the most developed, then at least in
the category of competitive countries.
References:
1) Конина Н.Ю. «Слияния и поглощения в
конкурентной борьбе международных компаний» // Монография. Москва. 2005;
2)
Лупашко С.В. «Государственное регулирование слияний и поглощений компаний» //
Государственная служба. 2007, № 2;
3) Рынок
поглощений Казахстана. Интернет журнал «Экономический терроризм» //
www.e-terror.ru/it2b2.view3.page139.html;
4)
Садешов А. «Welcome to Рынок. Слияния и поглощения» // analytical review –
обзорно-аналитический журнал Exclusive. Март 2006 // http://www.exclusive.kz/index.php?uin=1182486828&chapter=1182486862;
5)
Франгулиди С. «Казахстанский рынок слияний и поглощений в 2007 году» // Resmi
Advisor. Май 2008 год. Стр. 12-18.// www.ifd.resmi.kz/download/Resmi_Advisor_11.pdf
[1] Лупашко С.В. «Государственное регулирование слияний и поглощений компаний» // Государственная служба. 2007, № 2