Deloitte analysis: A slow start for the deal making activity in 2018

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Deloitte analysis: A slow start for the deal making activity in 2018

16 April 2018

Romania's merger and acquisitions market has reached 258 million EUR in the first quarter of 2018, a significantly lower amount compared to the same period last year, according to public sources and disclosed transactions, an analysis performed by Deloitte Romania has revealed. However, if the transactions with undisclosed amounts are considered, the total value of the M&A market looks similar to the same period last year reaching between 500 and 600 million EUR, according to Deloitte estimates.

"After a record 2017, the deal making activity in Q1 2018 has slowed down, but we remain confident about the full year. We have witnessed a single transaction with an official value of over 100 million EUR during this period of time, compared to five in the last quarter of 2017," said Ioana Filipescu, M&A Partner, Deloitte Romania.

In Q1 this year, a total of 19 transactions have been announced, including those with undisclosed value compared to 30 in the same period last year.

"The Series B capital raising of UiPath involving three of the world’s largest technology investment funds created the first Romanian unicorn thus placing Romania on the map for technology investors. UiPath, a company with a stunning growth, confirms the rise of the local IT sector, the star of the Romanian economy in recent years. We expect to see other transactions in this field in the future, considering the increasing number of start-ups,” Ioana Filipescu added.

Deloitte's analysis does not include the transactions with a value below 5 million EUR. A significant number of transactions below this threshold have been announced in Q1 this year.

The largest transactions in Q1 2018 were:

1.    Series B funding granted by Accel, Capital G and Kleiner Perkins Caufield & Byers to the Romanian start-up UiPath specializing in the development of solutions for automating internal processes using robotics (153 million USD). This transaction marks a first for the IT sector and UiPath has become the first Romanian unicorn, a start-up whose valuation exceeded one billion dollars.

2.    Unilever's acquisition of ice cream manufacturer Betty Ice at the end of a competitive sale procedure (value not officially disclosed).

3.    The acquisition by GreenGold Asset Management AB/KB of Cascade Empire and forest management division Ocol Silvic Cascade Empire from Schweighofer Group. Cascade Empire owned over 14,000 hectares of forests in Romania (value not officially disclosed).

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