M&A deals in Romania postponed amid regulatory uncertainty in Q1

Romania's merger and acquisition (M&A) market reached EUR 200-300 million in the first quarter of the year (Q1), including the deals where the price was not reported, according to estimates of financial consultancy Deloitte.

The transactions with disclosed prices totaled EUR 120 million. The reported market thus contracted significantly to roughly half of the volume reported in Q1 last year (EUR 258 million disclosed and EUR 500-600 million estimated). Furthermore, the M&A market in Q1 last year was already 36% down in annual terms.

Most likely, the subdued M&A activity in Q1 was caused by the regulatory uncertainty generated by the emergency ordinance (OUG) 114, an idea supported by Deloitte as well.

“Although the figures suggest an apparent reduction of activity, we believe that in the particular situation of this year’s start, we are rather witnessing an extension of the ongoing processes, which we expect to materialize in the next period. The market is still offering further opportunities for both consultants and for owners interested in selling. We are seeing exit incentives of some business owners who want to capitalize on this window of opportunity and which we believe will end successfully,” said Ioana Filipescu, M&A Consultant, Deloitte Romania.

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