London/Kyiv, 11 June 2020: Ukraine recorded €1.19bn worth of M&A activity in 2019, up 12% on the previous year and the highest annual deal value since 2013, according to a new report from Aequo and Mergermarket. Of this figure, 86% was generated by cross-border deals, suggesting strengthening international investor confidence.
The year’s single biggest deal was an inbound transaction: the €770m acquisition of telecoms operator VF Ukraine by Azerbaijan’s NEQSOL Holding. The second biggest deal involving a foreign buyer saw Switzerland’s Acino International acquire the Ukraine-based primary care portfolio of Takeda Pharmaceuticals, as part of a global deal.
“We saw a big increase in the number of large deals, with some really high valuations,” said Anna Babych, a partner at Aequo. “There was a clear pick-up in interest from foreign investors.”
Denis Lysenko, managing partner at Aequo added: “We saw a significant influx of portfolio investors into Ukrainian sovereign and quasi-sovereign bonds, and several M&A transactions that were either initiated or successfully closed in the second half of the year.”
Of course, the advent of the coronavirus crisis has injected substantial uncertainty into global markets, making the dealmaking environment for 2020 considerably more challenging. And Ukraine’s open economy, with strong trade ties to Europe and beyond, will not be unscathed.
However, Mergermarket data on the number of companies being prepared for sale is encouraging. In the six months to the end of January 2020 there were 39 stories being tracked, up from 19 at the same time the year before. While these sale processes could face interruption and substantial challenges in light of the global economic downturn caused by the Covid-19 crisis, the year-on-year increase demonstrates the health of the market, and offers some degree of hope for a quick recovery once the crisis passes.
Further key findings from the report include:
The technology, media, and telecoms (TMT) sector led the way in both deal volume and total reported value. In 2018-19, TMT accounted for 22% of overall deal volume, up from 12% in 2016-17. Total recorded value jumped from just €22m in 2016-17 to €810m in 2018-2019.
There were ten private equity (PE) transactions in 2019, two more than in 2018, and reported deal value almost tripled from €23m to €62m.
The report also includes a retrospective of the last five years in the Ukrainian M&A market, a period that has seen a steady rise in the number and overall value of transactions, up to last year’s high-water mark of €1.19bn worth of deals.
Aequo is an advanced industry-focused Ukrainian law firm made up of highly qualified, internationally recommended lawyers who work proactively to help their clients reach their business goals. Backed up by solid industry expertise and a thorough understanding of business, we develop innovative strategies and provide efficient solutions to the most complex and challenging matters.
Aequo provides integrated legal support in areas such as antitrust and competition, banking and finance law, intellectual property, corporate and commercial law, mergers and acquisitions, taxation, litigation and international arbitration, and capital markets.
The list of Aequo’s representative clients includes leading Ukrainian and international companies and organisations, such as Agroprosperis, Apax Partners, Apollo, Bunge, DuPont, EBRD, European Commission, Google, Inditex Group, NCH Capital, Pioneer Hi-Bred International, Samsung Electronics, Sandvik, Synthon, Tetra Laval, Ukrainian Redevelopment Fund, UniCredit Group, Vodafone Ukraine, etc.
Aequo has been named the Most Innovative Law Firm of the Year in Ukraine by IFLR Europe Awards 2018, Law Firm of the Year in Russia, Ukraine and the CIS by The Lawyer European Awards 2017 and one of the most innovative law firms in Europe according to the FT Innovative Lawyers 2015-2019.
M&A intelligence, data and research
In M&A, information is the most valuable currency. Mergermarket, an Acuris company, reports on deals 6-24 months before they become public knowledge, giving our subscribers a powerful competitive advantage. With the largest network of dedicated M&A journalists and analysts, Mergermarket offers the most comprehensive M&A intelligence service available today. Our reporters are based in 67 locations across the Americas, Europe, Asia-Pacific, the Middle East and Africa.