Below You May Find Comments by Marty Kotwis from FORDATA Summarizing the M&A Market in 2014

Below You May Find Comments by Marty Kotwis from FORDATA Summarizing the M&A Market in 2014

Warsaw, 16.12.2014 r.


Throughout the whole year experts from Fordata in cooperation with the advisory company Navigator Capital are observing the M&A market in Poland, Europe and the around the world. The conclusions of any collected data is published quarterly in a series of M&A Index Poland reports.

Below you may find comments by Marty Kotwis from FORDATA summarizing the M&A market in 2014.

"The past year has the potential to enroll in the history of M&A transactions. It is rated as the most active since the crisis and the downturn in 2009 by analysts from around the world, including Poland.

Already in the third quarter the value of transactions is more than 40% higher than it was in the third quarter of last year. Chances are that the growth trend in terms of the number of transactions in Poland will continue until the end of the year, to eventually close the year with a result over 20% higher than a year ago. We anticipate that the IVQ of the year, the number of transactions may be even higher than the 42 closed in the IIIQ.

In our opinion, such a good situation on the Polish market M&A is a result of a fairly stable economic situation in the world and a correct economic situation in the EU and the US, which means that investors are returning once again to invest. Besides, PE funds are finishing their investment cycles and the supply on the market is currently quite large. The market is also slowly driven by offers made by businesses established in the 90s. Their owners are looking for investors in the market, due to the lack of a successor in the family.

Although the number of transactions grows, a trend of a decline in the value of transactions can be noticed. Currently, the most common deals are closed at the level of 20-100mln. The largest transaction in 2013 closed with a result of more than 6.1 billion zloty (the acquisition of Polkomtel by CyfrowyPolsat), while in 2014 it was only 1.5 billion zloty (the acquisition of KWK Knurów – Szczygłowice by JastrzębskaSpółkaWęglowa, and the acquisition of RSA Insurance Group companies by PZU). In our opinion, the downward trend is there because on one hand there are no new privatization tenders on the market, and on the other hand, the market itself matures, so there is a lot going on, but also on a smaller scale.

We expect that 2015 in Poland will be similar to what it was in 2014, both, in terms of the quantity and the value of transactions. The number of transactions will increase and their value will drop. The most active will be industrial sectors, retail and those associated with modern technologies. We also expect further consolidation of the medical industry. 2015 will be dominated by small and medium-sized transactions of 20-100 million zloty.

Another noticeable trend will be the increase of interest of investors in streamlining M&A processes and more widespread use of modern technologies. We are already observing an increased interest in using the Virtual Data Room, which accelerates mergers and acquisitions. VDR has been a standard used for professional organization of transactional processes in mature markets for years now.

FORDATA (formerly Datapoint) is a pioneer on the Polish capital market. Using our own information systems built basing on the Virtual Data Room technology, we are improving document management and communications during complex transactional processes. We support the largest M&A, IPO transactions, private equity investments, restructurings, projects associated with obtaining financing and privatizations in Poland and other countries of Central and Eastern Europe. Our systems increased safety and efficiency of hundreds of different types of transactions with a total value of over PLN 30 billion. The FORDATA services are used by the industry leaders in Poland and abroad, including Private Equity Enterprise Investors fund, NFI Empik, ZELMER, Bank DNB, BOŚ Bank, PolimexMostostal, Budimex, DM PKO BankuPolskiego, Deloitte Advisory, Ernst&Young Corporate Finance, KPMG Advisory, Śnieżka, Enea, JSW, Espirito Santo Investment Bank and many others.

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