Poland leads CEE in PE investing

The Polish Private Equity Association estimates that private equity funds have in excess of E1.5bn to invest in Poland.

Private equity funds investing in Central and Eastern Europe have earmarked E1.7bn for investment in Polish investments, according to the Polish Private Equity Association (PPEA or Polskie Stowarzyszenie Inwestorow Kapitalowych).

The PPEA, which was formed in March 2002 and counts Advent International and Baring Private Equity Partners among its 22 founding members, says that foreign and local firms have designated around E5bn for investments in the central and Eastern Europe. Of the E3bn that remains to be invested, it estimates that half of this will go to Polish investments.

Dresdner Kleinwort Capital, another founding member of the PPEA, today announced a E5m investment in the expansion of Radio PLUS, Poland’s third largest commercial radio broadcaster. DrKC also invested from its $225m Emerging Europe Fund in March this year with a $2.5m strategic investment in Mieszko, the listed Polish confectioner.

Gyuri Karady, senior partner for Baring Private Equity Partners Central Europe, thinks that the area’s strength lies in its growth potential. “The region outperformed both Euroland and the US last year and is expected to do the same again this year.” BPEP has made seven investments in the region, including two in Poland, since it established its Baring Central European Fund in January 2001. “Part of the attraction to the region is the fact that despite the broad interest, competition for the best deals is not so intense as in Western Europe.”

According to the PPEA, there are over 35 fund managers currently active in the Polish private equity market, now in its twelfth year. The PPEA’s members have to date invested over E1.2bn in almost 300 companies in Poland.