EY analysis: Romania's M&A market down by almost 6 pct in terms of estimated transaction value in 2024

   Romania's mergers and acquisitions (M&A) market recorded 265 transactions in 2024, up 10% from the previous year (241 transactions), but the estimated value of transactions fell by 5.9% to 6.6 billion USD, compared to an estimated value of 7.1 billion USD in 2023, informs an Ernst & Young press release."Romania's mergers and acquisitions (M&A) market saw robust activity in 2024, registering 265 transactions with an estimated value of 6.6 billion USD. This indicates a 10% increase in the number of transactions compared to the estimated value in 2023 (241 transactions) and a 5.9% decrease in the estimated value (7.1 billion USD in 2023). The value of deals disclosed increased by 40.7% (2.9 billion USD in 2024, up from 2.1 billion USD in 2023), excluding last year's mega-deals, namely the acquisitions of Enel Romania (1.3 billion USD) and Profi Rom Food (1.4 billion USD). No deal value was disclosed for almost three-quarters (74.7%) of all deals announced in 2024 (198 deals), far exceeding the historical average of around 65% in 2018 - this is one of the lowest levels of transparency seen in CEE markets," the report mentions.According to the cited source, Romania continued to be a top performer in 2024, with a 10% increase in transaction volumes, compared to 5% in Europe. With renewed confidence and growing transactional appetite, activity is expected to accelerate in 2025, the cited source says."Strategic investors maintained their dominance of the local M&A market in 2024, accounting for 91.3% of deal volume and marking their highest market share in six years. Domestic deals fell marginally to 113, down from 120 in 2023, while foreign deals increased by 26.9% year-on-year to 132, highlighting Romania as a top destination for M&A in the CEE region," adds the analysis.Despite the smaller share of total activity, foreign deals increased by 54.5% to 17 deals, the highest number since 2018, demonstrating the resilience of Romanian investors in cross-border transactions, according to the research."In 2024, Romania maintained its growth trajectory in mergers and acquisitions (M&A) activity, underpinned by strong investor interest and an active deal environment. Levels of inbound M&A have increased significantly, accounting for half of total volumes in 2024, highlighting the gradual recovery of the global M&A market. Although short-term volatility may affect deal appetite, the Romanian market continues to be underpinned by attractive fundamentals for investors, which will boost M&A activity in the long term," said Iulia Bratu, Partner within the Strategy and Transactions department, Head of Lead Advisory, at EY Romania.The most active sectors by transaction volume were: Real Estate, hospitality and construction (18.5% of the number of transactions), followed by Energy and utilities (16.6%), Advanced manufacturing and mobility (15.5%), Technology, media and telecommunications (15.1%) and consumer products and retail (14.7%)."Real estate, hospitality and construction, a traditionally top M&A sector, saw 19.5% growth in 2024, with deal volume up to 49. In line with global patterns, the energy and utilities sector saw a 51.7% year-on-year growth, fueled by a doubling in deal volume to 38 deals (from 19 in 2023) in the renewables sub-sector. This growth underscores Romania's emergence as a major destination for renewable energy investments, underpinned by rich natural resources and alignment with EU policy commitments," the report further mentions.According to the cited source, advanced manufacturing and mobility maintained their position in third place, with 41 transactions, while the logistics sub-sector recorded a 20% increase in transaction volumes, reaching 12 transactions."Technology, media and telecommunications ranked fourth, holding steady at 40 transactions, fueled by a 55.6% increase in the media sub-sector. Bolsered by resilient private consumption, consumer products and retail ranked fifth, growing by a modest 5.4%, with the beverage sub-sector registering an impressive 267% growth in 2024," the analysis also shows.According to the report, the largest transactions of the year were the sale of a 629 MW renewable energy portfolio by Evryo Group (formerly CEZ Romania) to Public Power Corporation (PPC), Greece's leading power utility, for 768 million USD, and the acquisition of Hungary-based OTP Bank's Romanian operations by Banca Transilvania, the country's largest bank, for 375 million USD.Also on the list of big deals is the sale of a 99 MW onshore wind project by Sweden-based OX2 for about 234 million USD to Nala Renewables, a joint venture between Australia's IFM Investors and Trafigura, one of the world's largest suppliers of electricity."In 2024, the average transaction size returned to 2021 levels, to 42 million USD, reflecting the market's solid foundations. Finally, the most active investors by country of origin came from the United States (13.6% of inbound transactions), followed by Poland (8.3%, second for the first time) and France, Austria and Germany (7.6% each)," according to the analysis.EY Romania provides, through its more than 1,000 employees in Romania and the Republic of Moldova, integrated audit, tax, legal, strategy and transaction, strategy and transaction advisory services to multinational and local companies.