Despite uncertainty ahead of the Spanish general election later this year, M&A activity is holding up in some sectors, with private equity involvement set to increase
The Spanish telecommunications, pharmaceutical and leisure sectors are witnessing a significant amount of M&A activity, according to Roca Junyent partner Jaime Espejo, who adds that activity is increasing despite uncertainty over the outcome of December’s general election.
However, despite the fact that a reasonable amount of deals are taking place, Espejo says law firms still face challenges with regard to fees. “The issue of fees is something law firms have to face because clients are used to paying lower rates because of the financial crisis. They may now think [of legal services] as a commodity,” he adds.
That said, Espejo says there is not a major need for law firms to change their structures to meet client expectations, but rather operate in a more effective way. He continues: “It is a matter of efficiency but, at the end of the day, clients still want partners to be personally involved so it is not a matter of reducing the time you work on a transaction.”
In general, Espejo is optimistic in his outlook. He adds that while M&A work has mainly been carried out for corporate investors, an increase in work for private equity work funds is anticipated. “After the fundraising that they’ve been undertaking, we expect [private equity] houses to develop more in Spain,” he concludes.