Romanian M&A market faced slight diminution in 2018, says Deloitte

The Romanian M&A market neared 2 billion Euro in 2018, according to Deloitte Romania research, based on public sources and disclosed deal values. Deloitte estimates that the Romanian M&A market was somewhere between 3.8 and 4.3 billion Euro, slightly below the previous year.

“We witnessed a slight diminution of M&A activity in 2018, after a very specific set of circumstances in 2017, namely a record number of deals between 100 and 500 million Euro. Despite this slight YOY drop, the market remains at a robust level, as expected in a year of economic growth. The events of 2018 that represented a premiere were the two financing rounds obtained by UiPath, which attracted strong investment funds from around the world, thus becoming the first Romanian unicorn,” stated Ioana Filipescu, Corporate Finance Partner, Deloitte Romania.

In 2018, 14 deals with a disclosed or estimated value of at least 100 million Euro were announced. In total, there were 96 deals observed by Deloitte in 2018. The average value of the disclosed ones was 50 million Euro.

The largest deals of 2018 were:

• Vodafone’s acquisition of Liberty Global shares in Germany, the Czech Republic, Hungary and Romania (undisclosed value for Romania);
• the acquisition of Zentiva Group, including Zentiva SA Romania, former Sicomed, by Advent International (deal value estimated at 287 million Euro, by applying the disclosed EBITDA multiple to the 2017 results of Zentiva SA);
• the sale of Agricost to Al Dahra group, the largest deal in Romanian agriculture (value of 200 million Euro);
• the acquisition of The Bridge office building by the Paval brothers from Forte Partners (deal value undisclosed);
• the acquisition of a 7.5% stake in UiPath by a consortium of investors led by Sequoia Capital; following this acquisition, the company’s valuation reached 2.6 billion Euro (deal value of 194 million Euro); it marks the second round of financing for UiPath in 2018, six months from the first one;
• the takeover of the Oregon Park office project in Barbu Vacarescu, Pipera area, by Lion’s Head Investment, which marks its first acquisition in Romania (undisclosed value);
• the acquisition by the German group Phoenix of Farmexim distributor and Help Net network (undisclosed value);
• the sale by SIF Oltenia of the 6.3% stake in BCR to Erste Group Bank (value: 140 million Euro);
• Series B funding granted by Accel, Capital G and Kleiner Perkins Caufield & Byers to the Romanian start-up UiPath specializing in the development of solutions for automating internal processes using robotics (124 million Euro). Following this transaction, UiPath has become the first Romanian unicorn, a start-up whose valuation exceeded one billion dollars;
• the sale of Urgent Cargus by Abris investment fund to Mid Europa, the largest deal in this sector so far (deal value undisclosed);
• the acquisition of ArcelorMittal Galati by Liberty house, together with the entities in Macedonia, Italy and the Czech Republic (undisclosed value);
• the acquisition of a 23% stake in Alro, the aluminum producer from Slatina, by Paval Holding, an investment vehicle controlled by the Paval brothers (disclosed value of 108 million Euro);
• the acquisition of Betty Ice, the ice cream manufacturer, by Unilver, at the end of a competitive sales process (undisclosed value);
• the acquisition of Sun Plaza, the Novotel Hotel and Sun Offfices by Immofinanz (deal value undisclosed).

The Romanian M&A market, in 2018:

• market value (disclosed deals value): 1.9 billion Euro;
• average value (disclosed deals value): 50 million Euro;
• market value (including Deloitte estimates of undisclosed deals): between 3.8 and 4.3 billion Euro;
• number of deals (including deals with undisclosed value): 96;
• number of deals with a disclosed or estimated value of at least 100 million Euro: 14.