Drivers and Issues for M&A in Southeast Europe

Drivers and Issues for M&A in Southeast Europe

BDK Advokati’s senior partner Vladimir Dasic shared his thoughts on “Drivers, issues and countermeasures” at a panel organised by SEE Private equity and M&A forum in Belgrade. Other speakers at the panel were Alexandra Nagle from Alantra and Leo Morozov from Fortenova Group.

Vladimir emphasized the importance of maintaining a regional perspective because this is what gives investors the opportunity to grow. He also stressed that strong regional brands are attractive to investors, naming recent acquisition of Bambi by Coca Cola HBC that decided to buy Serbian confectionary giant although it does not directly fall under the beverage business.

There is still a lot of space for improvement on the target side. One of the opportunities for the local companies to grow and make themselves appealing is by installing professional and experienced management. Many of them still condone to a traditional family style of running business that is not suitable for big systems. There are some good examples of companies that hired professional leadership to enable growth, but the majority still sticks to conservative management methods which is a shame both for them and the investors.

There is space for progress on the financing and regulatory side as well, Vladimir added. IFI and local banks are more than willing to finance large transactions and projects involving big market players. Unfortunately, the situation is not the same with smaller deals, where banks hesitate to invest and impose very complex procedures. At the same time, complex foreign currency exchange rules and NBS policies are another puzzle that makes it hard for foreign investors to enter the local market.

Nevertheless, Vladimir remains positive for 2020 when he expects further market consolidation and an increase of competition among local players which should altogether attract new investors.

BDK Advokati’s senior partner Vladimir Dasic shared his thoughts on “Drivers, issues and countermeasures” at a panel organised by SEE Private equity and M&A forum in Belgrade. Other speakers at the panel were Alexandra Nagle from Alantra and Leo Morozov from Fortenova Group.

Vladimir emphasized the importance of maintaining a regional perspective because this is what gives investors the opportunity to grow. He also stressed that strong regional brands are attractive to investors, naming recent acquisition of Bambi by Coca Cola HBC that decided to buy Serbian confectionary giant although it does not directly fall under the beverage business.

There is still a lot of space for improvement on the target side. One of the opportunities for the local companies to grow and make themselves appealing is by installing professional and experienced management. Many of them still condone to a traditional family style of running business that is not suitable for big systems. There are some good examples of companies that hired professional leadership to enable growth, but the majority still sticks to conservative management methods which is a shame both for them and the investors.

There is space for progress on the financing and regulatory side as well, Vladimir added. IFI and local banks are more than willing to finance large transactions and projects involving big market players. Unfortunately, the situation is not the same with smaller deals, where banks hesitate to invest and impose very complex procedures. At the same time, complex foreign currency exchange rules and NBS policies are another puzzle that makes it hard for foreign investors to enter the local market.

Nevertheless, Vladimir remains positive for 2020 when he expects further market consolidation and an increase of competition among local players which should altogether attract new investors.