CMS Emerging Europe M&A 2024 ̸ 25 report: Emerging Europe deal activity rebounds, reaching highest levels since 2018

Findings from the CMS Emerging Europe M&A 2024/25 report, published today in cooperation with EMIS, demonstrate the resilience of the Emerging Europe  deal market as activity rose to the highest levels since 2018. Market confidence has been bolstered by improving economic conditions and a greater sense of stability as inflation continues to subside, and central banks cautiously anticipate further interest rate cuts.

The report shows that deal flow in Emerging Europe increased by 8% compared with 2023, with 1,281 deals announced in 2024. However, despite higher deal volume, aggregate deal value fell by 30.9% to EUR 25.72bn. Values were impacted by the relative absence of “megadeals” valued at EUR 1bn or more. In 2024, there was a shift towards small and mid-market deals. Average deal value fell to EUR 20.1m in 2024 compared with EUR 31.4m in 2023.

Outlook

Horea Popescu, Partner at CMS Romania, comments: “Despite some short-term challenges, dealmaking in the CEE region remains attractive for international investors, as shown by higher deal volumes in a range of countries and sectors last year. As optimism looks set to become the hallmark of 2025, buyers will continue to capitalise on the region’s diverse investment opportunities.”

Cross border investment

Cross border deals remained strong with activity increasing to 776 deals, 31 higher than the previous year. Standout performers for M&A included the United States, which retained its top position by deal count (102), and the UK, which ranked as the second most active foreign investor (68) despite deal volume decreasing. Aggregate deal value reduced from EUR 35.5bn to EUR 23.3bn, with Luxembourg ranking in first place by deal value (EUR 2.01bn).

Country hotspots

Poland maintained its position as a major M&A market (269 deals at EUR 5.77bn) and Romania was the region’s second most active jurisdiction (187 deals), however, both saw overall reductions in deal volume compared with 2023. Countries where deal activity increased included Bulgaria (88 deals), Croatia (92 deals) and Hungary (63 deals), where volumes rose by 7.3%, 10.8% and 10.5% respectively. Several countries saw deal values fall compared with 2023, including Poland and Hungary, due to fewer megadeals. However, the Czech Republic and Slovakia present a more complex picture as deal volume fell by 7.2% (128 deals) and 14.6% (35 deals) respectively – but deal values jumped by 53.8% (EUR 5.65bn) and 25.5% (EUR 4.19bn).

Sector diversity

The report shows that there were significant shifts in the sectors driving deal activity. By recorded deal value, the largest sectors were Energy & Utilities, Real Estate & Construction and Food & Beverage. Energy & Utilities saw deal value increase by 162% (rising from EUR 3.72bn to EUR 9.75bn). Real Estate and Construction saw an increase in both deal volume (194, up from 158) and value (EUR 5.65bn, up by 77.2% from EUR 3.19bn).

Horea Popescu, Partner at CMS Romania, comments: “The M&A sector in the CEE region is continuing an exciting period of transformation, driven by regulatory changes, new technologies, energy transition, and developing business strategies.”

Rodica Manea, Partner at CMS Romania, comments: “Companies in the manufacturing and industrial sectors, particularly in Romania, as well as in the region, are leveraging acquisitions to enter new geographic markets, diversify their product lines, and enhance their technological capabilities.”

Private equity

In 2024, Emerging Europe saw private equity deal volume increase by 12.6% to 278 deals. However, reflecting the wider trend seen across the region, private equity deal value fell by 11.4% to EUR 13.88bn. Notable deals included Blackstone’s acquisition of a portfolio of ten logistics assets in the Czech Republic and Slovakia for EUR 470m and CVC Capital Partners’ acquisition of Partner in Pet Food (PPF) in Hungary for EUR 2.0bn, which was the largest transaction by value.


The CMS Emerging Europe M&A 2024/25 report can be found here.