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Private Equity Confidence Survey Central Europe

From adversity to Agility 

The Private Equity Confidence Survey has been tracking the changing sentiments of the Central European investment community every six months since 2003. Deloitte Central Europe proudly presents the latest report which marks the 40th edition of the programme.

As our Survey marks its 20-year milestone, we can look back at the decades and see the sentiment peaks and troughs that reflect market conditions. From the ‘golden years’ of the noughties leading up to the Global Financial Crisis (GFC) and then the recovery that followed, through to the coronavirus pandemic and its aftermath, it’s clear the Deloitte Central European (CE) Private Equity (PE) Confidence Survey Index has acted as a strong barometer not only of sentiment, but ultimately of market activity.

Central European Private Equity Index: Key findings

2023 should be a good vintage for private equity investment in Central Europe.
Over 80% of respondents are confident the year will prove a good vintage for investments, and pipelines are improving, with a more than doubling of respondents seeing more actionable opportunities now (41%) than in our Summer Survey (18%). While 40% of respondents will await a more favorable backdrop to launch sales processes, the majority of processes underway (57%) remain so in today’s market.

Vendors’ price expectations may be coming down, with nearly half of respondents (45%) feeling they’ve decreased in H2 2022 and nearly two-thirds (64%) expecting them to decrease in H1 2023. The expectations for the first half of this year are the same as our Summer Survey, pointing to consistency in sentiment on how valuations may play out this year.

Two-fifths of deal doers are looking more to credit funds and non-bank lenders as they find leverage more difficult to secure for deals, while just over a third (35%) have experienced no change in leverage availability. Nearly a fifth (17%) report needing more lenders now for a deal.

The market has seen an unusually high number of shocks in just three years, with the post-pandemic recovery giving way to inflation and interest rate rises causing investors to pause and reflect,

- says Dusan Sevc, Deloitte Partner and Private Equity Leader.

 

In our Survey’s 20 years we have seen that each shock is followed by a rise in confidence, economic conditions, and transacting, so we trust the region’s investors to draw on their experience to help businesses remain resilient and embrace opportunities for sustainable growth in today’s backdrop.

 

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Private Equity Confidence Survey Central Europe

Experienced and well capitalized

Index slides as activity, pricing stabilize

Experience, discipline and an enduring pandemic are catalyzing pragmatism among deal doers, according to the latest Deloitte Central Europe Private Equity Confidence Survey.