PE spends big in CEE

CEE buyout values totalled €6.3bn across 43 deals last year, up from just €1.1bn of spending across 74 deals in 2016.

Private equity spending in Central and Eastern Europe rocketed last year amid growing confidence to commit large sums of capital in the region, according to research from S&P Global Market Intelligence.

CEE buyout values totalled €6.3 billion across 43 deals last year, according to the firm’s latest EMEA Private Equity Market Snapshot. This compares with just €1.1 billion of spending across 74 deals in 2016.

The growth is attributable to two mega-deals in 2017, with Permira, Cinven and Mid Europa’s $3.3 billion acquisition of Polish online marketplace Allegro accounting for 50 percent of aggregate CEE deal values over the period. Last year’s deals also included UniCredit offloading a €2.7 billion stake in Warsaw-headquartered Bank Pekao to Polish financial giants PFR and PZU.

Poland continues to dominate the region, collecting 86 percent of buyout investment last year. The country has accounted for €9.2 billion of the €13.4 billion spent in CEE over the past five years, followed by Czech Republic and Romania at €2.1 billion and €1.5 billion respectively.

Although Poland now boasts a broad spectrum of investment banks and intermediaries to facilitate exit routes, other regions, such as the Balkans, are still a “question mark”, Jacek Siwicki, president of private equity firm Enterprise Investors, told Private Equity International in December.

“It is not completely homogeneous,” he said. “There are still countries where certain segments of the investment chain are not as well covered as in Poland or the maturity of the exit market is not there yet.”