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CEE M&A remained stable in 2019, dipping 15.9% by value versus 25% across Europe

Mergermarket, the leading provider of M&A data and intelligence, has released new data finding that the Central and Eastern Europe (CEE) region has remained resolute in 2019, dipping by 15.9% by value versus around 25% across Europe.

  • YTD 2019 saw 306 M&A deals worth EUR 11.2bn, in line with H1 2018
  • Private equity in the region has recovered well after a slow start to 2019

Mergermarket, the leading provider of M&A data and intelligence, has released new data finding that the Central and Eastern Europe (CEE) region has remained resolute in 2019, dipping by 15.9% by value versus around 25% across Europe. This year has seen 306 transactions for EUR 11.2bn, driven by two deals above the EUR 1bn mark, falling slightly from YTD 2018 (EUR 13.3bn, 334 deals). The data was announced at Mergermarket and Unquote’s CEE M&A and Private Equity Forum 2019, held on 1-2 October at the Intercontinental Hotel, Warsaw.

“M&A targeting CEE appears to be stable despite uncertainties across global markets. Activity in the region remained in line with 2018 figures despite slower trends elsewhere in Europe. Dealmaking going forward is likely to be driven by inbound activity as opposed to domestic M&A, in contrast to global trends,” commented Zaynab Dost, Research Relationship Manager at Mergermarket.

The pace of private equity deal-doing in CEE has recovered well after a very slow start to 2019, according to Mergermarket private equity sister brand Unquote, and the number of deals completed in the year to end July (46) is ahead of the same period last year (36). However, activity remains subdued compared with the market of a few years ago, with high price expectations and question marks over medium-term economic outlook likely to be limiting factors.

“Despite a subdued market, a rise in activity in the Baltic states and the emergence of new, truly local capital (including limited partners and family offices) in areas such as the Czech Republic are both encouraging signs. Furthermore, record levels of available capital in the region should ensure a continuing flow of deal completions irrespective of any headwinds,” said Julian Longhurst, Head of Data & Research at Unquote.

“Private equity has become increasingly important in our region, especially if we look at the relative weakness of local stock exchanges. Obtaining significant funds from public share issues is more and more difficult. In this context, M&A transactions play an important role in providing capital to young, innovative companies and ensuring their development. They are also crucial for the generational change visible in our region. The founders of many companies - many established in the 1990s just after the fall of communism - are maturing to transfer them into new hands. Given these trends, we at BNP Paribas have increased our focus on investment banking, advisory on M&A transactions and also play a key role in their financing,” commented Przemek Gdański, CEO of BNP Paribas Bank Polska.

“While Central and Southeastern Europe are not isolated from global investment trends, its economies continue to attract international corporates and private equity, as well as growing  inter-regional investment. We see a rather stable M&A trend that is based on the region‘s solid growth rates, increasing local retail consumption, industry digitalisation and consolidation”, explains Horst Ebhardt, Partner, Head of Corporate/M&A, Wolf Theiss.

BNP Paribas and Wolf Theiss are among the principal sponsors of the CEE M&A and Private Equity Forum 2019.

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