Maturity, momentum and mega-deals
Welcome to PricewaterhouseCoopers’ CEE Mergers & Acquisitions (M&A) Survey 2006. In this edition we provide detailed coverage of M&A and privatisation activity within the CEE region as a whole, as well as:
- Consider the incentives offered to attract foreign investment
- Highlight industry ‘hot-spots’
- Key deal data on individual countries
- Showcase some successful transactions
In our research we track publicly disclosed, private-sector transactions in 11 countries of the region: Bulgaria, Croatia, Czech Republic, Hungary, Poland, Romania, Russia, Serbia, Slovakia, Slovenia, Ukraine.
According to the survey, in line with the UK and continental Europe which last year achieved their strongest M&A performance in recent history, transaction activity in CEE was also extremely buoyant. In total 2,527 publicly-disclosed private transactions were completed last year in the 11 countries of the CEE region. Overall, deal volume rose by 37% last year while the total value of these transactions rose by 79% and reached a record-breaking USD 163bn compared with USD 91bn in 2005.
Robust growth in CEE means that M&A market value last year doubled that seen in 2005 and more than tripled the aggregate value of M&A recorded in 2004. Much of this growth was due to an outstanding performance by Russia which recorded 1,210 transactions totalling USD 111bn during 2006. As a whole, however, M&A activity in CEE remained strong with new stars such as Ukraine and Serbia beginning to attract considerable investment attention.
Key findings for Russia:
- M&A market growth of 111% last year — up from USD 53bn to USD 111bn in 2006, representing nearly 70% of CEE’s M&A market.
- Deal volume shot up from 706 to 1,210 in 2006 of which 922 deals were completed by domestic companies. Deal volume growth of 71% ranks Russia second in this category.
- Russia saw 142 transactions valued at over USD 100m last year. The total average deal size was USD 181m.
- Hottest industries were manufacturing (including metals), financial services and energy & utilities.
- An increased presence from UK and US investors who closed 59 deals in 2006 compared with 42 in 2005.
- Russia closed 102 outward transactions in 2006, and the main targets of Russian investors were Ukraine (22), UK (8) and US (7).
- A total number of 158 privatisations averaged at USD 9.1m.
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