Significant mergers and acquisitions in Central and Eastern Europe faced challenges in 2024, but consistent deal flow demonstrates market’s strength.
The latest annual CEE M&A report, released by Forvis Mazars Group in partnership with Mergermarket, highlights a decrease in deal value in the CEE region. Despite this, there was a slight increase in deal volume, indicating the market’s resilience.
The Investing in CEE: Inbound M&A report 2024/2025 provides an overview of M&A activities in 2024 and forecasts the challenges and opportunities in the region moving forward. In 2024, there were 1,270 transactions in the CEE region, totaling €27.4bn in value. While there was a 30% decline in deal value compared to the previous year, deal volume increased by 3%.
Andrija Garofulić, Partner, Financial Advisory, Forvis Mazars in Adria subregion, mentioned that despite tough conditions, the focus in the M&A market is still on growing, buying, and selling businesses. However, if instability persists, there may be opportunities for distressed deals and restructurings in the next year.
Private equity (PE) dealmaking saw a decline in 2024, with buyout volumes falling consistently since 2021. Răzvan Butucaru, Partner, Forvis Mazars in Romania, highlighted that European fundings have created new opportunities in the CEE region and instilled confidence in PE funds to expand. This trend is expected to boost local entrepreneurship and business maturity.
Looking ahead to 2025, political factors are likely to be major challenges for the region, along with economic uncertainties. However, easing tensions in regions like Ukraine and the Middle East could increase confidence among inbound acquirers. The CEE region is also positioned to benefit from global trade tensions, potentially accelerating manufacturing renaissance.
Despite a challenging year, growth projections for the CEE region remain positive, outpacing Western Europe. Looser monetary policies are helping to facilitate deals that were delayed due to valuation disagreements.
Key findings from the report include Poland, Austria, and Romania emerging as top M&A deal generators in terms of volume in 2024. Hungary led in aggregate deal value, with the technology and industrials sectors being prime attractions for inbound dealmakers.
The report also noted that deal multiples in the CEE region were among the lowest compared to recent records, indicating favorable investment opportunities. Romania stood out as the third most sought-after destination for investment in Central and Eastern Europe, with a growing presence in the regional market despite a decrease in total deal value.
The resilience of Romania as an investment hub speaks volumes about its potential for long-term growth and stability. The country’s ability to attract both local and international players underscores its significance in the CEE region’s economic landscape. The shift towards energy and utilities sectors in M&A activities in Romania in 2024 highlights the increasing focus on sustainability and renewable energy in the region’s economy.
