M&A deals volume in Bulgaria seen rising on good liquidity in financial markets, real economy growth

Diana Nikolaeva,
Partner, Transaction Advisory Services,
EY Bulgaria

What key trends are currently impacting the development of Bulgaria’s M&A market?

During the last two years there has been a strong pipeline of M&A deals and while specific industry concentration is not that obvious and deal size vary within a wide range, I would identify two distinctive trends:

The structure of the market in various industries suggests a continuous consolidation among industry players to achieve synergies and enhance competitive strength.

Many companies have reached a level of development where their further growth would be best realized by partnering with a strategic investor.

Which sectors do you see dominating Bulgaria’s M&A market in the coming years?

Strengthening M&A activity was especially visible in the real estate sector. We have seen a number of large deals in commercial real estate. Food and beverage is also an industry witnessing investor interest and the IT sector, of course.

What are your estimates regarding the volume and number of M&A deals on the Bulgarian market in 2017 and how would they compare to 2016? What are your expectations for 2018?

The activity so far suggests that the value of deals will probably exceed 2016 deal volume. The good liquidity in the financial markets, the growth of the real economy, the disruptive effect of technology on all aspects of business suggest that this trend will continue in the near terms at least.