INSIDE CORPORATE, in its fourth edition, is a study of M&A activity in CEE/SEE, alongside macroeconomic and legal developments, published by Mergermarket in cooperation with WOLF THEISS, one of the leading European law firms in CEE/SEE.
The study, which canvassed the opinions of 150 senior-level executives about their experiences and outlook on M&A in the CEE/SEE region, also includes a review of M&A activity in 2015, along with insights into some of the main legal developments that affect M&A transactions in each country in CEE/SEE.
“Overall, the CEE/SEE region continues to be a major emerging market, still growing at twice the speed of Western Europe, with many of its countries making significant progress in reaching EU standards,” said Horst Ebhardt, who heads the Corporate and M&A Group at WOLF THEISS. “From a political perspective and from a risk diversification perspective, CEE/SEE has again become a relatively safe harbour for equity investors seeking to benefit from emerging market dynamics in a region that also offers stability, combined with easy access to the European Union, the largest consumer market in the world by purchase power,” Ebhardt adds.
“Deal flow in the region has been very stable over the past three years, and the big M&A stories of 2015 again took place in the more mature markets of the region: Poland and the Czech Republic. But easily available finance and a global appetite for growth through M&A has made investors more open to seeking out targets in some of the smaller economies such as Croatia, Serbia and Slovenia,” says Sonja Caymaz, research editor at Remark, part of the Mergermarket Group. “However, the survey communicates that there is still a lot of regulatory red tape and a lack of transparency that act as deterrents to dealmaking.”
These findings are reflected by M&A activity in 2015. Poland, for example, saw deal value grow 79% YoY to €6.9bn, with a 10% rise in deal volume YoY from 126 to 138. Indeed, the CEE/SEE region as a whole saw stable levels of M&A activity in 2015, with deal volume across all countries rising 2% year-on-year (YoY) to 473 deals, although deal value fell 5% to €23.2bn over the same period.
Other key findings from the report include:
- In terms of deal drivers, those surveyed said that they are attracted to markets first and foremost by economic growth (85%), followed by the level of infrastructure development (65%) and a stable regulatory/legal framework (55%).
- The sector regarded as the most likely to see the most distressed opportunities is energy, mining, and utilities, largely due to the sustained low prices for commodities across the board and electricity in most CEE/SEE countries.
- For private equity firms, TMT will be the most attractive sector in the CEE/SEE region over the next 12 months, according to 80% of PE firms surveyed, followed by consumer (74%) and pharma, medical and biotech (62%).
INSIDE CORPORATE, in its fourth edition, is a study of M&A activity in CEE/SEE, alongside macroeconomic and legal developments, published in cooperation with WOLF THEISS, one of the leading European law firms in CEE/SEE with a focus on international business law. Drawing from extensive data on CEE/SEE M&A trends, the report offers insight into the economic, political and legal challenges and opportunities facing the region, as well as the outlook for 2016.
To view the full report, please click here: www.wolftheiss.com/knowledge/wolf-theiss-guides/detail/inside-corporate-corporate-monitor-fy-2015/