2018 was a very fruitful year for our whole Mazars Central & Eastern European Deal Advisory teams, specialized in Transaction Services (including financial and tax due diligence), Valuation and Corporate Finance.
This document showcases a selection of transactions that we advised on throughout the CEE region.
Referring to the profile of our clients as well as the main M&A geographical and sectorial trends observed, there are a few factors that have directly influenced our transactional activity.
STRONG APPETITE TO INVEST IN THE CEE REGION FROM WESTERN EUROPE, THE USA AND CHINA
With a well-educated and skilled workforce, wage levels which remain competitive and a rising local consumer demand, the CEE is together with Asia Pacific the fastest growing region in the world.
Austria remains an important bridgehead to the whole Central & Eastern European area. Bulgaria, Croatia, Czech Republic, Hungary, Poland, Romania, Slovakia and Slovenia: the former communist countries which have joined the European Union since 2004 offer generally higher growth opportunities than in Western Europe, combined with the benefits and protections of EU membership.
Both foreign large multinationals and SMEs are interested in dynamic CEE targets active in sectors like Automotive, Manufacturing, Financial Services, Healthcare & Pharmaceuticals, Aerospace & Defence or Hospitality & Leisure. Non-EU countries from the Balkan region (Albania, Bosnia & Herzegovina, Kosovo, Montenegro, Serbia) also attract more and more the attention of international investors. As far as Russia and Ukraine, they start to recover from recession which creates promising investment perspectives, notably in Oil & Gas, Energy, Agriculture and IT sectors.
CEE PRIVATE EQUITY INVESTMENTS ON THE RISE
PE funds are drawn to the CEE region’s attractive economic development, increasing consumer spending and high-growth investment opportunities. Within the CEE, Vienna, Warsaw, Prague and Budapest concentrate most PE funds active regionally. A certain number of international funds cover their CEE activity from Western Europe (London, Luxembourg), investing in the region out of a pan-European or global fund.
AN INCREASING NUMBER OF CEE FIRMS INVESTING OUTSIDE THE REGION
More and more SMEs from CEE which are “hidden European champions” in their sector express their appetite for external growth in Western Europe, Asia or Africa. Mazars belongs to the very few global advisors able to follow those CEE companies worldwide.
Observing already a healthy pipeline of M&A activity for 2019, we expect Central and Eastern Europe to strengthen its position as a key target for international investors during the year, with a few sectors booming, like e-commerce.