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Central & Eastern Europe M&A

Latest update: 8 January 2021

CEE saw a sizeable uptick in the final quarter of the year, pointing to an active year ahead. Dealmakers managed to weather the storm caused by the pandemic with the region seeing a total of 421 deals for a disclosed value of EUR 20.2bn, a 15% decline by value versus 2019 (EUR 23.7bn, 527 deals) while the region’s annual deal count fell to its lowest result since 2012 (415 deals, EUR 14bn). However, hopes for a better 2021 remain – encouraged by stable level of inbound investments and sponsor-driven activity.

  • Despite the uncertainty caused by the pandemic, M&A in the region was mainly driven by foreign investors (200 deals, EUR 14.1bn), only 6% lower by value compared to 2019 (EUR 15bn, 240 deals). Inbound investments accounted for a 69.8% share of the market by value, thanks to a number of larger deals, including region’s top deal – Iliad SA’s EUR 3.6bn acquisition of PLAY       Communications. Intra-CEE dealmaking, however, saw 221 transactions for a disclosed EUR 6bn, including Budapest Bank’s acquisition by Magyar Takarekszovetkezeti Bank (EUR 2bn) and Optima       Investments’ purchase of a 61.49% stake in Globe Trade Centre for EUR 1.4bn.
  • Private equity activity in the region finished the year on a high note. After slowdown in the previous quarters, CEE-based buyouts picked up in Q4 (27 deals, EUR 1bn), reaching annual total of 57 transactions worth EUR 2.8bn, up 7.6% by value from 2019 (EUR 2.6bn, 62 deals). Exits recorded 35 transactions for a total of EUR 7.3bn, with a rise to 13 deals in the final quarter of the year, from eight deals worth EUR 3.7bn in 3Q20. The value was boosted by the aforementioned Play Communications deal. This deal almost tripled the exits value compared to 2019 (EUR 2.6bn, 42 deals), marking the highest annual value on Mergermarket record.
  • Telecommunications and financial services were the year’s biggest sectors by value reaching a combined EUR 9bn, accounting for 44.8% of the overall market. This was boosted by several large deals, including the EUR 1bn acquisition of AXA’s       Poland, Czech Republic and Slovakia operations by UNIQA       Insurance Group and the EUR 830m takeover of Aegon’s       Central and Eastern European business by Vienna Insurance       Group. Industrials & Chemicals was the most active sector by deal count, seeing 82 transactions for a disclosed EUR 815m, four more deals than in 2019 (78 deals, EUR 712m).

Top deals in FY20

Announced Date
Target Company
Target Dominant     Sector
Bidder Company
Seller Company
Deal Value     EUR(m)
21-Sep-20
PLAY Communications S.A.
 (Poland)
Telecommunications


Iliad SA
 (France)

 Tollerton Investments Ltd;
 Kenbourne Invest SA
 (Luxembourg)


3,687
30-Oct-20

 Budapest Bank Zrt
 (Hungary)
Financial Services

 Magyar Takarekszovetkezeti Bank Zrt.
 (Hungary)


Corvinus Nemzetkozi Befektetesi Zrt.
 (Hungary)
2,000


 06-Apr-20




 Globe Trade Centre S.A. (61.49% Stake) (Poland)


Real Estate
Optima Investments Limited
 (Hungary)
Lone Star Funds
 (USA)
1,429


 09-Jan-20



Residomo SRO (Czech    Republic)
Real Estate
Heimstaden Bostad AB
 (Sweden)

 Blackstone Group L.P.; Round Hill Capital LLC
 (United Kingdom)


1,300


 07-Feb-20




 AXA SA ( Poland, Czech Republic and Slovakia operations)
 (Poland)


Financial Services
UNIQA Insurance Group AG
 (Austria)
AXA SA
 (France)
1,002

For more proprietary analysis and opportunities on CEE (excl. Russia), click here.

by Zaynab Dost in London

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