The average deal value is at an all-time high and the local market ranks first in the region, ahead of Poland (EUR13.4 million), Czech Republic (EUR18.2 million) and Hungary (EUR4.5 million).
“Central and Eastern Europe exit values can be affected by a limited number of large deals. In 2018, the five largest transactions accounted for 44% of the region’s overall exit value. These transactions took place in Poland, Hungary and the Czech Republic,” Invest Europe’s report reads.
In Romania, as in Hungary and Czech Republic, there was one large deal that drove the market, ZF has found. The deal in Romania was the acquisition by Mid Europa Partners of parcel delivery company Urgent Cargus from another private equity firm, Abris Capital.
The private equity firms doing exits either sell to another financial investor or to a strategic investor. In Romania, it is usually one private equity firm selling to another, as in the Urgent Cargus case.
For a private equity firm to exit, the sale usually needs to be profitable, which means the investor gets more than it invested. This is why such firms usually stay four to five years with a company on average. The duration of the stay may vary with the type of business and shareholder’s plans.
This is the main difference between a private equity firm and a strategic investor; the latter stays long term for an unspecified period of time.
(English version by Loredana Fratila-Cristescu)