M&A activity set to increase, but profitability remains a challenge – Roca Junyent

Greater political certainty in Spain will lead to an increase in dealflow, but with law firms fighting for deals in a highly competitive market

Now that Spain has a stable government, M&A activity will grow in the next 12 to 15 months, predicts Carlos Blanco, partner at Roca Junyent. However, he warns that maintaining profitability will not be easy for law firms.
“The biggest challenge for law firms now is profitability,” says Blanco. “There is deal flow, but there is high competition between different law firms in Spain – there are Anglo Saxon firms, there are very sophisticated big and medium-sized Spanish law firms, so now we are fighting to get the deal.”
One area that has great potential for corporate lawyers in Spain is the venture capital market, according to Blanco. “Traditionally in Spain we have seen private equity but not venture capital,” he says. “This is a segment which is increasing in Spain now – we are seeing new funds being created by experienced industry executives; I think this can fuel deals in the sector.”
The outlook for private equity activity is also promising. “There are several private equity funds in Spain – which closed their fundraising, one, two or three years ago – that know our market very well,” says Blanco.