BANGLADESH Law and Practice Contributed by: Nasirud Doulah and Amina Khatoon, Doulah & Doulah
1. Trends 1.1 M&A Market
an off-market investment instrument in Bangladesh. The increased interest in such deals raises new regu - latory issues, such as valuation. Start-Ups Start-ups in Bangladesh have always been a major focus for both local and cross-border private equity funds and private investors. However, recently there has been a renewed interest in local start-ups by devel - opment organisations such as Asian Development Bank (ADB) Ventures, Investment Fund for Developing Countries (IFU), and Responsibility Investments, albeit the acquisition of stakes in such businesses is more driven by sustainability interests than returns. Diversification of Investor Portfolio Deal-making across several sectors continued, driven by growing interest from multinationals and foreign investors due to the restoration of a more competitive regulatory framework for investors from diverse coun - tries, such as the United States and Europe. This is also sometimes driven as part of diversification strat - egies to reduce over-reliance on countries like China and India. Infrastructure Infrastructure development through PPP was intro - duced in 2010, before which only power projects were allowed to be developed in this manner. The PPP Act, 2015, further facilitated the development of infrastructure by the private sector. Accordingly, there has been a recent trend of mergers and acquisitions of private-sector infrastructure and power projects. For example, the first toll road project, ie, the First Dhaka Elevated Expressway, was acquired by new investors in 2021 and 2024 to the extent of 49% and 100%, respectively. 1.3 Key Industries M&A activity in Bangladesh in 2024 was mostly focused on the energy and power sector; however, certain other industries also stood out. Major industry concentration in the past 12 months for M&A includes the following. Healthcare and Pharma Driven by increased healthcare spending and tradi - tional strengths in pharma manufacturing. Several
Although Bangladesh offers a liberal M&A regime and almost no restrictions on country-specific foreign direct investment (FDI), its M&A market, with around 200 million consumers, remains underdeveloped. Compared to global deals involving M&A of assets in Bangladesh, actual deals in the local context are still outnumbered. However, as the country has become an attractive destination for FDI, which suggests that there is still ample space in the market, rapid growth in the number of mergers and acquisitions transactions in Bangladesh in recent times has been observed. In the context of the 2024 political upheaval in Bang - ladesh, which ultimately led to regime change, the country saw an immediate decline in deal completions as investors adopted a “wait and see” strategy. The credit ratings of Bangladesh were lowered by major rating agencies, including Fitch, S&P, and Moody’s, amid concerns about political instability. Neverthe - less, recent deal trends indicate that investor confi - dence is returning, with transaction activity expected to surpass pre-turmoil levels in the near term. 1.2 Key Trends While quieter than 2023, the M&A market in Bang - ladesh in 2025 is showing impressive levels of deal- making, aided by a better regulatory environment and driven by continued business confidence and inves - tor optimism about reduced corruption and long-term political stability following the turmoil in 2024. Some major trends in recent times have been outlined below. Asset-Based Deals In Bangladesh, most acquisitions are led by mid-mar - ket and conglomerate buyers, and the share acquisi - tions have been the most widely adopted structure. However, asset-based acquisition has been gaining popularity in recent years due to stronger enforcement of bad-debt provisions by local banks and a reduction in transaction costs for asset-based deals. The sale of business undertakings is also gaining popularity. An Off-Market Negotiated Sale It is a less common method of acquiring publicly listed shares, but it has gained popularity in recent years as
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