Private Equity-Backed Buyout Deals in Central and Eastern Europe – June 2014

by Ciantelle Lawrence

  • 25 Jun 2014
  • PE

In 2014 YTD, 35 private equity-backed buyout deals with an aggregate value of €1bn were witnessed in the Central and Eastern Europe (CEE) region. This represents 8% of all European deals in terms of number of deals and 3% in terms of the aggregate value. 

Preqin’s Buyout Deals Analyst shows that three countries dominate the private equity deal activity in the region; Russia, Poland and Turkey account for over half (53%) of the number of all buyout deals in the CEE region since 2006, with their aggregate value of investments contributing 51% of the CEE region total. At €7bn or 22% of the total, Russia has received the largest proportion of the capital invested in the region, with Turkey attracting 18% (€5.8bn) of the invested capital, followed by Poland receiving 11% (€3.4bn).

In terms of value bands within the CEE region, transactions with a value of up to €100mn accounted for 63% of all reported private equity-backed buyout deals in 2014 YTD, while 25% of deals were valued between €250mn and €499mn, with the remainder valued between €100-249mn.

The healthcare and information technology sectors contributed the largest number of deals in 2014 YTD, each accounting for 20% of the total. This has been an increase since 2013 when healthcare and information technology contributed 14% and 11% respectively. It has also been the highest proportion that the information technology sector amassed over the past eight years; perhaps the catalyst for this trend is the growth of the ecommerce market across the region and the expansion of the CEE internet user base. In contrast, the most prominent industry last year, telecoms & media, which constituted 18% of deal activity in 2013, only comprises 9% of deals within the region so far this year, suggesting a shift in private equity investment preferences. 

Despite healthcare being one of the two most prominent industries in Central and Eastern Europe in terms of number of deals, healthcare only accounts for 1% of the aggregate value of private equity-backed investments in the region in 2014 YTD, perhaps due to the fact that typically, investment activity in healthcare is in the form of smaller sized, earlier-stage deals. For 2014 YTD, Preqin’s Buyout Deals Analyst online service demonstrated that industrials and information technology are the most dominant sectors in the CEE region. 

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