Private Equity Confidence Survey

The Central European private equity market continues its strong run, with continued investments, exits, and fundraising news reported by deal doers. A growing regional economy, continued liquid leverage markets and high number of owner-managed business ripe for backing have all created the ongoing backdrop conducive to PE deal doing.

Romania will continue to be an interesting territory for financial investors with a series of large transactions involving private equity firms in the past 18 months, a good indicator of Romania’s attractiveness and good position on the market.

Markets thrive on certainty, and 79% of respondents expect the strong economy to be maintained (67%) or improve (12%) over the coming months. The Index thus remains high, though slightly less so than our last survey, which mirrors the economic expectations: the remaining fifth of respondents (21%) expect economic conditions to worsen, which is double the proportion of last time (10%).

The backdrop is nevertheless conducive to deal-doing, with over two thirds of respondents (69%) expecting to focus mostly on new deals in the coming months. Leverage for these deals will be plentiful, and market-leading companies will be most competitive – as is perennially the case in our survey. Pricing increases may be coming down, with a doubling (to 17%) of the percentage of respondents expecting vendors to accept less for their assets over the next year.