Investments in Poland will grow: experts

DC Advisory Poland expects M&A and PE investment levels in Poland to improve compared to 2019. In particular, experts expect an uptick in activity in e-commerce, TMT, and infrastructure. 

“Polish pension fund reforms (slated for summer) will likely drive many listed companies toward public to private transactions to avoid de facto State control. Financial sponsors should watch this space,” the report reads.

Despite the pandemic, Poland has seen an almost 30 percent increase in M&A volumes in 2020, compared to 2019. A temporary pause in the second quarter of 2020 M&A deal-making was followed by record-breaking Q3/Q4 2020, highlighted by successful exits of local PEs as well as landmark transactions in the TMT space. 

The local infrastructure market is increasing interest to investors driven by EU funding as well as regional government initiatives (e.g. Three Seas Initiative supported by the US). Green transformation driven by the EU and adopted by the Polish Government will boost renewable energy-related transactions, especially after the implementation of favorable offshore wind regulations.

The Polish labor cost advantage, supported by a strong local talent pool, will continue to drive the re-location of many manufacturing and business services companies to Poland

Given the overall economic rebound and continued strong sentiment in public and private markets, we expect M&A and private equity investment levels in Poland to see continued growth and activity throughout 2021. Although the pandemic “third wave” has been a cause for concern across the region, the economic recovery in Poland has been robust – GDP for 2021 is set to exceed 3 percent; 2022 is meant to exceed 5 percent

The successful large IPOs of major Polish e-commerce companies – Allegro and Inpost – have built a strong investor sentiment for e-commerce overall, both privately and in the local public market.

Outside hard-hit sectors (e.g., travel and hospitality) many businesses have fully recovered, and the economic outlook for the next year is strong – the EU expects the Polish economy to be one of the best performers in Europe.

(WBJ)