DELOITTE TAX SRL

  |  2017-04-07

Deloitte Romania: Q1 2017 brings correction in the M&A activity

After a record breaking fourth quarter of 2016, the first quarter of 2017 has brought a correction in the value of significant M&A transactions in Romania, with a disclosed amount of 368 million EUR and 28 deals. Compared to the first quarter of 2016, in Q1 2017 there were 40% more transactions and the disclosed value increased by 11%.

Ioana Filipescu

Compared to the last quarter of 2016, the current quarter is 10% down in the number of transactions and more than halved in market value, even without taking into consideration the two mega-transactions of Q4 2016 (Mid Europa – Profi and Asahi – Ursus Breweries).

 

 

“The local M&A market is going through a favourable time and the first quarter has been in line with our expectations. We estimate that the activity will continue to maintain at the level of 2016 given the positive results registered by companies in all fields of activity as well as a big interest of the large private equities for Romania,”said Ioana Filipescu, M&A partner Deloitte Romania.

 

 

The largest transaction in this quarter has been Fortuna Entertainment Group’s acquisition of Hattrick Sports Group, including Casa Pariurilor, a transaction whose upfront Romanian we estimated at 51 million EUR. Deloitte has provided transaction services support to the buyer. Second largest transaction is the announced take over and 50 million EUR capital increase of City Insurance by Berlin London Beteiligungs specialized investment fund. The top 3 is closed by the 42.5 million EUR acquisition of the Oarja warehouse by Globalworth Real Estate.

 

The average transaction size in the quarter was 25 million EUR, in line with past quarters although below Q4 2016. Considering the transactions with undisclosed value, Deloitte’s best estimate on the total Romanian M&A market value in the first quarter of 2017 is in the 370– 500 million EUR range.

 

During Q1 2017, Deloitte Romania’s Corporate Finance team has completed the negotiations on the sale of Goodmill’s fresh bakery business and assets to a group of 18 local buyers and is dealing with a number of projects in different stages of execution both on the sell-side as well as on the buy-side.

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