Ukraine dealmaking shows signs of recovery after difficult years

London/Kyiv, 13 April  2017: Ukraine’s M&A market saw an uptick in 2016, with deal volume rising by 35% year on year, according to a new report by Aequo and Mergermarket. Disclosed deal value also rose 131% to €310m, although this figure was boosted by UniCredit’s sale of Ukrsotsbank to ABH Holdings for €281m.

The upturn in Ukraine’s M&A market in 2016 was indicative of the country’s slowly recovering economic growth. Denis Lysenko, a managing partner at Aequo, comments: “Looking at the macroeconomic situation, and GDP numbers in particular, we can say that Ukraine effectively has passed the bottom of the downturn. We expect that 2017 will be another year of moderate growth in the economy overall, which will probably translate into more deals.”

Other than recovering growth, a number of other factors may help catalyse dealmaking in 2017. For example, the IMF is backing the restructuring of state-owned enterprises, including several electricity distribution companies. “There are around 400 state enterprises up for privatisation, including around 20 major companies,” says Anna Babych, a partner at Aequo. “These are the big ones where Ukraine expects to attract international investors, including PE houses.”

Despite growing optimism about the outlook for Ukraine, there are still downside risks. The uncertain geopolitical environment makes it more difficult for the government to push much-needed reforms that would stand Ukraine in good stead over the longer-term, including overhauling the judiciary, the tax system, and the cutting of subsidies.

Further key findings from the report include:

To view the full report, please click here.

 

About Mergermarket

Mergermarket is an independent Mergers and Acquisitions (M&A) intelligence service with an unrivalled network of dedicated M&A journalists based in 62 locations across the Americas, Europe, Asia-Pacific, the Middle-East and Africa. Unlike any other service of its kind, Mergermarket specializes in providing forward-looking origination and deal flow opportunities integrated with a comprehensive deals database – resulting in real revenues for clients. Visit www.mergermarket.com.