The M&A market in Poland remained active even during the pandemic, but 2021–2022 brought a clear rebound. Last year, we broke through the ceiling of 300 closed deals.

Transactions hit a new all-time high

In recent years, the M&A market in Poland regularly recorded more than 200 completed transactions per year, a figure that did not change even during the pandemic year of 2020. While there was a decline from the previous years – down to 205 closed deals – it was rather slight given the standstill in the M&A market in March–May 2020. At that time, buyers and sellers alike focused on their own operations rather than on acquisition processes. The year 2021, however, already saw an upswing in transactions – up to 295 – and in 2022, the number exceeded the 300-deal threshold, reaching 348 transactions. This is also the highest number of closed deals since 2010.

Mateusz Biegajło

PhD, Manager, M&A Team

The coronavirus crisis has trained investors to operate under conditions of market turbulence – they want to buy for strategic purposes. Industry investors, especially international players whose strategy is to grow through acquisitions, are no longer looking to reap the benefits of their investments in 2, 3 or 5 years, but are increasingly declaring a 20–30 year time horizon. There are still many crises or black swans ahead, but investors are aware that business must be nurtured irrespective of the conditions. If they fail to take advantage of the current market opportunity, someone else will – most likely their competitor. From the sellers' perspective, the aim is to sell the business at the best possible price. Buy or sell? Important decisions of such a magnitude require an individual approach and a detailed analysis of each process.

Chart 1. Number of M&A transactions in Poland between 2017 and 2022

Chart 1. Number of M&A transactions in Poland between 2017 and 2022

The “hyperactivity” of 2021–2022 can partly be attributed to a shift in transaction volumes from 2020, but this is not a key factor. More than anything else, we are seeing a lot of interest from foreign investors whose strategies assume growth through acquisitions and who continue to see great potential in Poland.

It is worth mentioning that the average annual deal count in Poland’s M&A market for 2017–2022 is 256, which roughly translates to one completed transaction per working day. Our M&A market is very robust, with one of  the highest numbers of transactions in Europe.

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Industry investors lead the way

The data collected by Grant Thornton indicate that businesses in search of an investor should first look to their direct competitors at home or abroad. This is because nearly 75 per cent of transactions involve industry investors, i.e. they take place between entities operating in the same market or in a related industry. The second-largest investor category is financial investors, accounting on average for around 20 per cent of transactions. The other buyers (around 5 per cent) include e.g. individual investors and management buyouts.

Importantly, the structure of investors in the Polish M&A market has been relatively stable, irrespective of the year under review or the market situation. Neither COVID-19 nor the war in Ukraine have managed to deter industry investors, who are still keen to gain market share and build synergies, or financial investors – looking for business opportunities.

Chart 2. Activity of different investor groups in the Polish M&A market between 2017 and 2022

Chart 2. Activity of different investor groups in the Polish M&A market between 2017 and 2022

TMT consolidation continues but traditional industries are holding strong

In recent years, investors have shown a strong interest in businesses active in the TMT sector. While in 2017–2018 the sector recorded “only” about 25 transactions per year, last year there were already over 70 closed deals. It is generally believed that the TMT sector turned red hot due to the outbreak of the pandemic, but a significant increase in the number of transactions could be seen in this market already in 2019. So, TMT businesses did not become attractive just because of COVID-19, the process of consolidation in the industry had already started in 2019.

At the same time, years of consolidation in the consumer products sector appear to have come to an end, with 2022 seeing the fewest transactions in this sector since 2010. Notably, before the “TMT era”, the consumer products sector was the most attractive in terms of transactions.

There is currently a lot of interest in the energy sector, mainly projects related to solar farms, wind power and the structuring of state-owned energy companies. Investors are also looking for entities representing the medical and biotechnology sector, which has seen significant growth as a result of the coronavirus pandemic.

Table 1. M&A transactions in Poland between 2017 and 2022 by business sector

Table 1. M&A transactions in Poland between 2017 and 2022 by business sector

The division of business sectors into two groups – traditional and modern, with the latter including TMT, internet and e-commerce – shows that traditional industries still dominate in terms of the number of completed transactions. Admittedly, from 2019 onwards, there has been an increase in the number of acquisition processes in modern industries, but since then their share of the M&A market has held stable at 25%. This means that traditional industries account for three quarters of the transactions carried out in the Polish market.

Investors are still keen to acquire players in traditional markets that provide synergies and expand their range of strategic options. This also shows that for many investors Poland remains a market of interest, also in sectors where production and labour costs are still lower than in the West.

For more information check out our report

REPORT: M&A Market in Poland

Analysis of domestic M&A transactions between 2017 and 2022

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