Mongolia: New Frontiers in M&A and Private Equity
08 November 2011 , Kempinski Hotel Khan Palace, Ulaanbaatar. Mongolia, with perhaps untold riches of mineral deposits, has surged onto the world stage at time of record high commodity prices.
The lion’s share of demand has historically come from its large neighbor to the south, but recently many are clamoring for a share of the Mongolian growth story. However, Mongolia is a frontier market with limited development across the board from infrastructure to financial markets.
Since 2007, traditional M&A involving Mongolian targets has been limited. According to mergermarket data, 17 deals have taken place in this small nation totaling not even US$1bn. A particularly highlighted cross-border deal involved a consortium of bidders comprised of MCS Holdings, the Mongolian conglomerate and Kerry Holdings, the Hong Kong-based investment firm owned by the Kuok Group. The deal in question saw the consortium acquire QGX, the listed Canadian mineral exploration company for approximately US$246m in 2008.
However, a budding M&A trend is developing. This year has already seen a significant number of transactions with four deals totaling US$558m. The largest of the four saw Hong Kong-listed Mongolian Mining Corporation agree to acquire the Baruun Naran coking coal mine for US$464m – the QGX asset changing hands once again.
In light of recent activity, the question remains whether Mongolia will live up the hype. In M&A and investment circles, Mongolia is somewhat of a buzzword, as is energy demand. However, despite volatility in commodity prices, the fact remains that the world’s primary energy resources are finite while demand is seemingly endless. This has major implications for the Mongolian economy as well as M&A activity in this once sleepy nation.
Agenda:
18:30 Registration
19:00 Panel discussion
20:00 Q&A
20:15 Dinner, drinks & networking
Topics to be addressed:
Mongolia has historically welcomed foreign direct investment into the country though the lion’s share of FDI has arrived just since 2005. How will the climate for foreign investors develop as Mongolia itself develops?
China, energy-hungry and 1.3 billion strong, has been the largest contributor of FDI since 1990 by a significant margin. However, FDI from some other countries, particularly Europe and North America, have made significant investment of late. Going forward, which countries will be the primary bidders into Mongolia?
What differences exist between listed and unlisted companies in terms of corporate governance and transparency? What should M&A investors be aware of when buying an unlisted company?
The Hong Kong Exchange’s new regulations governing the listing of mining companies aim to pit the bourse against the LSE in competing for large listings, while Toronto and Sydney could be more viable for early-stage companies. At the same time, the Mongolian bourse has teamed up with the LSE to attract its own share of listings. What are the IPO prospects for Mongolian firms going forward?
For new bidders looking to enter the market, how difficult is it to source and complete a transaction?
What are key risks of investing in a frontier market and how does Mongolia stack up against some of the other frontier markets in Asia?
Will private equity play a role in the development of the investment market in Mongolia? What sectors and investment types will private equity target going forward?
Speakers include:
Bold Baatar, Chairman, Mongolian Stock Exchange & Chief Executive Officer, Newcom Group
Mandar Jayawant, Managing Director, Mongolia Opportunities Partners
George Lkhagvadorj Tumur, Managing Director, Hunnu Coal
Mark Lehmkuhler, Partner, Davis Polk & Wardwell LLP
Bonnie Chan, Partner, Davis Polk & Wardwell LLP
Jim Dwyer, Executive Director, Business Council of Mongolia (moderator)
For more information please contact Amy Chau:+852 2158 9782, Eventsapac@mergermarket.com
Please note that this article has not been written, is not copyrighted and does not in any case represent the views or opinions of M.A.D. Investment Solutions or any of its affiliate individuals or companies. The article above is purely meant for information only to readers and does not constitute a legal or biding agreement in any way, shape or form. For contact and comments directly relating to the above article, please refer to the source as stated below.
Source : Merger Market
The lion’s share of demand has historically come from its large neighbor to the south, but recently many are clamoring for a share of the Mongolian growth story. However, Mongolia is a frontier market with limited development across the board from infrastructure to financial markets.
Since 2007, traditional M&A involving Mongolian targets has been limited. According to mergermarket data, 17 deals have taken place in this small nation totaling not even US$1bn. A particularly highlighted cross-border deal involved a consortium of bidders comprised of MCS Holdings, the Mongolian conglomerate and Kerry Holdings, the Hong Kong-based investment firm owned by the Kuok Group. The deal in question saw the consortium acquire QGX, the listed Canadian mineral exploration company for approximately US$246m in 2008.
However, a budding M&A trend is developing. This year has already seen a significant number of transactions with four deals totaling US$558m. The largest of the four saw Hong Kong-listed Mongolian Mining Corporation agree to acquire the Baruun Naran coking coal mine for US$464m – the QGX asset changing hands once again.
In light of recent activity, the question remains whether Mongolia will live up the hype. In M&A and investment circles, Mongolia is somewhat of a buzzword, as is energy demand. However, despite volatility in commodity prices, the fact remains that the world’s primary energy resources are finite while demand is seemingly endless. This has major implications for the Mongolian economy as well as M&A activity in this once sleepy nation.
Agenda:
18:30 Registration
19:00 Panel discussion
20:00 Q&A
20:15 Dinner, drinks & networking
Topics to be addressed:
Mongolia has historically welcomed foreign direct investment into the country though the lion’s share of FDI has arrived just since 2005. How will the climate for foreign investors develop as Mongolia itself develops?
China, energy-hungry and 1.3 billion strong, has been the largest contributor of FDI since 1990 by a significant margin. However, FDI from some other countries, particularly Europe and North America, have made significant investment of late. Going forward, which countries will be the primary bidders into Mongolia?
What differences exist between listed and unlisted companies in terms of corporate governance and transparency? What should M&A investors be aware of when buying an unlisted company?
The Hong Kong Exchange’s new regulations governing the listing of mining companies aim to pit the bourse against the LSE in competing for large listings, while Toronto and Sydney could be more viable for early-stage companies. At the same time, the Mongolian bourse has teamed up with the LSE to attract its own share of listings. What are the IPO prospects for Mongolian firms going forward?
For new bidders looking to enter the market, how difficult is it to source and complete a transaction?
What are key risks of investing in a frontier market and how does Mongolia stack up against some of the other frontier markets in Asia?
Will private equity play a role in the development of the investment market in Mongolia? What sectors and investment types will private equity target going forward?
Speakers include:
Bold Baatar, Chairman, Mongolian Stock Exchange & Chief Executive Officer, Newcom Group
Mandar Jayawant, Managing Director, Mongolia Opportunities Partners
George Lkhagvadorj Tumur, Managing Director, Hunnu Coal
Mark Lehmkuhler, Partner, Davis Polk & Wardwell LLP
Bonnie Chan, Partner, Davis Polk & Wardwell LLP
Jim Dwyer, Executive Director, Business Council of Mongolia (moderator)
For more information please contact Amy Chau:+852 2158 9782, Eventsapac@mergermarket.com
Please note that this article has not been written, is not copyrighted and does not in any case represent the views or opinions of M.A.D. Investment Solutions or any of its affiliate individuals or companies. The article above is purely meant for information only to readers and does not constitute a legal or biding agreement in any way, shape or form. For contact and comments directly relating to the above article, please refer to the source as stated below.
Source : Merger Market
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