Dealmaking in the CEE region undeterred by COVID-19, report shows

The disruption caused by COVID-19 to CEE’s M&A market was short-lived as dealmaking returned to the fore in the second half of the year, according to a new report published by Mazars in association with Mergermarket.

Deal value in the CEE region rose by 11 percent to 49.2 billion Euro, compared to 2019, even as volume dropped by 16 percent to a total of 648 transactions. This rise in deal value, in spite of the global pandemic, highlights the enduring appeal of the region for investors interested in big-ticket deals. When not including Russia, the region’s largest economy, recorded deal value figures in 2020 saw a 28 percent year-on-year increase.

International buyers continue to be attracted to the region, accounting for 49 percent of total deal value – investing 23.9 billion Euro – in line with previous years. Fabrice Demarigny, global head of financial advisory at Mazars, highlights how “on a global level, the CEE picture is one of stability. The region continues to attract a strong and steady flow of inbound investment from around the world.”

Private equity remained extremely active in 2020, with total disclosed buyouts in the region seeing a 40 percent year-on-year rise to 3.9 billion Euro. Private equity exits also fared well, with total disclosed value coming to 8.1 billion Euro, an 11 percent rise in 2019.

As COVID-19 vaccines continue to be rolled out, it is hoped that the second half of 2021 will offer a more stable dealmaking environment. However, risks from new waves of the virus, international disputes, and unexpected economic shocks are ever-present.

Romania registered 40 deals in 2020, down 27 percent compared to 2019, while the total disclosed deal value came to 1.7 billion Euro, which is more than double compared to the previous year. Much of this total was due to the largest deal of the year in the country, which was Macquarie’s acquisition of the Romanian assets of the Czech energy company CEZ for one billion Euro.