The Romanian market size has decreased with almost 50% (1.1$ billion in H1 2016, as opposed to 2.1 in H1 2015), as shown in EY’s M&A Barometer.
The total H1 2016 estimated transaction value in the CSE market was US$14.1b, 14.3% lower than in the previous year. This drop is mainly due to less mega deals over US$1bn in this period. Although the overall transaction volume increased in H1 2016, the majority of the countries experienced decreased M&A activity in terms of the number of transactions.
There were 655 closed transactions in H1 2016. The Czech Republic was the most active country in terms of deal volume, followed by Turkey, Poland, Hungary. Romania occupies the 5th place, with 56 transactions in H1 2016 (almost 30% less than the same period of last year).
„As opposed to the same period of last year, when Unicredit ?iriac Bank was the largest transaction in all the CSE countries, this year we’ve experienced a bit of a slowing down, with fewer megadeals. However, the growing interest and the number of ongoing transactions will reverse the descending trend,” says Florin Vasilica, Leader of Transaction Advisory Services, EY Romania.
The share of financial investors was the highest in Greece where financial investors were responsible for 40% of the market, followed by Hungary (39%) and Serbia (33%). In Romania, only 18% of investors were financial.
The Czech market witnessed exceptionally strong growth also in terms of deal value in H1 2016, and despite lack of deals over US$100m, the estimated transaction value increased by 74.1% compared to H1 2015.
CSE market – dominated my domestic transactions
The CSE transaction market was again dominated by domestic transactions in H1 2016 as in 57% of the total number of deals the buyer and the target originated from the same country. This represents a 9% percentage point increase compared to H1 2015.
The proportional share of inbound transactions was the highest in Croatia (64%), followed by Romania (61%) and Bulgaria (45%).
In Romania, the most active sector was manufacturing, while in the Czech Republic, Poland and Bulgaria, it was the IT.
Although there were fewer foreign inbound deals compared to domestic deals, in terms of the origin of foreign capital invested in CSE by M&A transactions, US based and Western European investors continued to lead against CSE countries in H1 2016. Germany, France and Poland were the most active investors in Romania, in H1 2016.