Findings from the CMS Emerging Europe M&A 2023/24 report, published today in cooperation with EMIS, demonstrate the resilience of the Emerging Europe[1] deals market as activity holds firm against a backdrop of geopolitical tensions and strong inflationary pressures.

The latest report reveals a modest slowdown in total deal flow across Emerging Europe, with 1,187 deals recorded compared to 1,229 deals in 2022. However, these were up from the 2021 total of 1,164 deals. Despite lower valuations and fewer large transactions, deal value stayed on par with 2022 values, at EUR 32.48bn in 2023 compared with EUR 32.93bn in 2022.

Notably, with inflation trends showing signs of improvement during the summer, investor confidence experienced a revival in the latter part of the year. The deal value for each quarter demonstrated improvement, resulting in a significant overall increase for H2 2023 (EUR 19bn), representing a 41% increase on H1 2023 (EUR 13.5bn).

Cross-border deal activity, meanwhile, remained strong, with total value increasing to EUR 30.8bn in 2023, despite attracting 69 fewer deals than the previous year. The United States maintained its top position by deal count (96), while the United Arab Emirates emerged as the leader by deal value (EUR 3.16bn), fuelled by mega deals in the telecoms sector, including the EUR 2.5bn acquisition of PPF Telecom Group’s assets in Bulgaria, Hungary, Serbia, and Slovakia by UAE-based e&.

Horea Popescu, Partner, CMS Romania, comments: “Investment from the Middle East into Central and Eastern Europe has been fairly consistent over many years, but this year we have seen a number of large transactions from Gulf investors. As a result of resurgent oil and gas prices, we expect further interest in the region as investors from across the Middle East seek to make strategic investments. The CEE remains attractive to investors worldwide, offering good economic fundamentals that will not change because of short term difficulties: a skilled labour force, proximity to Western Europe, low transportation and labour costs, and an increasingly developed infrastructure.” 

Sector diversity

The report shows remarkable diversity across Emerging Europe’s sectors, with no one sector dominating the deal landscape. Telecoms & IT secured the largest share of deals (266) across the region, accounting for 22.4% of all deals, followed by Manufacturing at 15.2%, and Real Estate & Construction at 13.3%. While overall deal count in the Telecoms & IT sector decreased by 70 deals in 2023, deal value surged by 140.3% to EUR 9.1bn. Manufacturing came in at second place by deal value at EUR 6.57bn, with Nippon Steel Corp’s EUR 2.75bn acquisition of the Slovakian business of U.S. Steel claiming the region’s largest deal of 2023.

Meanwhile, renewable energy deals featured heavily across the Energy & Utilities sector, with a significant number of wind and solar deals completed across 2023, including UGT Renewables’ agreement with Montenegro-based EPCG for the development of a new large-scale solar plant in Montenegro. With CEE generating just 25% of its electricity from renewables, compared to 55% from fossil fuels, the potential for further activity in this sector remains ripe.

Private Equity and IPOs

While the global IPO market showed signs of improvement in the latter half of 2023, regional listings remained scarce, dwindling from 13 to just eight in 2023, a significant drop from the peak of 60 observed in 2021. However, the total value of IPOs experienced a notable rebound, soaring from EUR 40m to EUR 2bn, primarily fuelled by a substantial listing: Hidroelectrica on the Bucharest Stock Exchange, amounting to EUR 1.89bn.

Although the volume of private equity deals slightly decreased to 248 transactions last year compared to the 289 deals recorded in 2022, the deal value surged by 57%, reaching a four-year high of EUR 15.7bn. Noteworthy among the active U.S. private equity firms was The Carlyle Group, which acquired Meopta–Optika in the Czech Republic for EUR 677m, and Advent International, which secured the purchase of MyPOS in Bulgaria for EUR 500m.

Country hotspots

Standout performers in M&A activity for 2023 were Poland (284 deals at EUR 7.45bn), Romania (199 deals at EUR 5.54bn), and the Czech Republic (139 deals at EUR 3.73bn). Meanwhile, deal values in Hungary almost doubled to EUR 3.77bn from EUR 1.96bn, the highest level since 2018, largely thanks to the EUR 1.64bn acquisition of Vodafone Hungary by Corvinus and 4iG. However, the number of deals fell by 11% from 64 to 57, the lowest figure since 2020.

In Ukraine, Vitaliy Radchenko, Partner, CMS Ukraine, highlights the increasing M&A activity in the country, with 89 deals worth EUR 950m, reflecting growing confidence in Ukraine’s rebuilding efforts.

“Although businesses are still feeling the intense burden of the war, it’s heartening to witness the resilience of the nation, with civilian infrastructure, energy substations, schools and hospitals continuously being rebuilt,” comments Vitaliy Radchenko. “Ukraine’s recovery plan is already shaping up to be the most extensive reconstruction effort in Europe since World War II, underscoring the need for sustained efforts toward post-conflict reconstruction and continued international support. Some large US companies have already taken the first steps to engage in the rebuilding process, including Bechtel who signed a reconstruction agreement with Ukraine’s State Agency for Restoration and Infrastructure Development relating to key infrastructure corridors. However, much more support and investment is needed to meet the scale of the challenge once the war is over.”


Helen Rodwell, Partner, CMS Czech Republic, expressed her outlook for 2024, stating: “Resilience is indeed the best word to describe M&A activity in CEE. Despite past and current challenges across our region and beyond, deal volume outperformed the western European markets – fuelled by economic growth in CEE, opportunistic buyers and local capital who are ring-fenced or have adjusted to the new economics of deal-making, family succession (Meopta), large corporates entering the market (Profi) and disposals of non-core business assets (Vodafone HU). We sensed a change in sentiment and appetite in Q4 2023 with higher deal activity than earlier in the year and that sentiment and appetite has continued into the first weeks of Q1 2024.”

Sławomir Czerwiński, Partner, CMS Poland, adds: “Poland continues to be the foremost market for M&A in Central and Eastern Europe, boasting the highest number of transactions and the greatest overall value. A pivotal sector witnessing escalating activity, not just in Poland but throughout the region, is renewable energy, with numerous deals in the pipeline. Anticipation in this sector is projected to stay robust in the next few years, driven by the European Union’s expectations for decarbonisation. Furthermore, investors see this sector as secure; numerous investment funds are showing a keen interest in acquiring operational assets, as these ensure a minimum level of revenue.”

[1] Emerging Europe comprises the following countries: Albania, Bosnia and Herzegovina, Bulgaria, Croatia, Czech Republic, Estonia, Hungary, Kosovo, Latvia, Lithuania, North Macedonia, Moldova, Montenegro, Poland, Romania, Serbia, Slovakia, Slovenia, and Ukraine.


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