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04 March 2021
media coverage

Polish M&A Market – Times Are Changing

Looking back at 2020, one can draw some conclusions and identify some trends in the Polish transactional market likely to stay with us in 2021.

We have seen a lot in recent months, especially after the worldwide pandemic broke out and changed how we live and work. But those changes were not all bad, and transactions are continuing despite the uncertainty.

After an initial slowdown during the spring lockdown in most European economies, the market in Poland made a comeback, with many transactions, large, medium, and small. The market favored experienced players: buyers and sellers who had done deals in the recent past showed more confidence during that period and were more likely to close deals. In the middle and smaller sectors of the market there was some uncertainty on the side of founders who were looking to sell the companies they had built over the previous two or three decades. Also, some funds decided to delay their exits from investments in sectors that could be considered particularly vulnerable to the pandemic crisis. At the end of the year, however, some of these transactions came back.

Additionally, lower valuations have led to a fairly high number of tender offers on the Warsaw Stock Exchange. While this may mean that the WSE will lose some of its valuable companies, it also means that there are a significant number of new companies look-ing at the Warsaw market as a place to list, especially following the successful IPO of Allegro, which may pave the way for other large companies.

While technology-related deals were already on the rise prior to COVID-19, there was particular activity in this sector in 2020. Naspers’ investment in Carsmile, the acquisition of BabbleLabs by Cisco, and Smart Pharma’s purchase by Chiesi clearly illustrate that investors in this area are particularly active and are gaining confidence in technology-intense areas. In addition, Illiad’s recent tender offer for mobile telecom operator Play and Nets’ acquisition of Polskie ePlatnosci also fit the picture. Innovative and IT infra-structure investments have clearly increased.

In real estate, logistics has proven to be a strong area in Poland throughout the year and the outlook looks promising. New players have entered the market and are teaming up with local developers for new projects. This activity also reflects the recent changes in how we live and in retail.

While many market participants positioned themselves for significantly more distressed transactions as a result of the pandemic’s impact on the economy and limited access to financing, there were fewer such deals than originally expected. It is possible that dis-tressed deals will come to the market a little later, when the protective effect of the COVID-aid packages wears out. We are already seeing increased demand in this area, and the revamped Polish legal environment for distressed transactions, including the favorable pre-pack provisions, provides a good environment for such deals.

How transactions are put together has also changed a lot. Like other professionals, M&A advisors and lawyers have learned to negotiate and make deals without holding physical meetings. Until recently, the use of video calls, especially in private M&A, seemed quite exotic, but market participants have embraced the change surprisingly quickly. In a number of transactions, we managed without the presence of clients even at signings and closings. Technology also allows us to be more efficient, both in time and travel costs. Whether or not we will be able to cope without in-person meetings in the longer run remains to be seen. While a teleconference cannot always convey the same thing as an in-person meeting, the current travel restrictions will most likely stay with us into 2021.

The M&A industry has once again proved its flexibility and vitality, and the experiences of the passing year give us reasons for cautious optimism going forward. While some businesses may face difficulties due to the unstable economic environment in the coming year, there should also be plenty of opportunities for transactions.


Office Managing Partner