ARMENIA Law and Practice Contributed by: Hayk Hovhannisyan and Tachat Voskanyan, HAP
HAP LLC 4/3 Adonts street Yeraz business centre 3rd floor Yerevan Armenia Tel: +374 9140 3605 Email: hayk.hovhannisyan@hap.am Web: www.hap.am
1. Trends 1.1 M&A Market
Unified economic zones push businesses to combine their efforts in today’s globalised world. In addition, Armenia’s small market size encour - ages business consolidation due to the neces - sity of proper technical re-equipment, because the market is small and incomes are limited. Despite challenges, Armenia’s IT, construction, and energy sectors are growing and expected to attract local and foreign investors as businesses adopt new technologies to expand. 1.3 Key Industries Armenia’s tech sector, supported by government incentives and diaspora investments, drives M&A deals, especially in software, AI, and digital transformation. Companies seek expansion to enter global markets. Renewable energy, par - ticularly solar, wind, and hydro, will also attract growing investments in 2025. Foreign companies show interest in Armenia’s green energy potential. M&A activity is also ris - ing in healthcare, pharmaceuticals, agriculture, and real estate.
In Armenia (RA), businesses are often based on family or friendly ties, making M&A deals rare. Mergers involving state non-commercial organi - sations are more common in state-owned com - panies, mainly in healthcare and education. Company capital is usually increased by issuing new shares and attracting shareholders. Share acquisition is the most common way to acquire a company in RA. M&A activity also faces chal - lenges, partly due to regional tensions. The M&A market recorded positive results at the end of 2023. Sectors such as renewable energy, IT, and financial services gained new momen - tum, driven by government reforms and growing interest from foreign investors. 1.2 Key Trends Global factors like geopolitical tensions in the South Caucasus and the Russo-Ukraininan war will continue to affect M&A activity in the region, including RA, in 2025. Political shifts in neigh - bouring countries and changes in the interna - tional arena may further impact investor confi - dence, especially in sectors such as energy and infrastructure.
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