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COVID-19 pandemic impacted the M&A market

CzechInvest has published the M&A Report for second quarter of 2020

COVID-19 pandemic impacted the M&A market Source: Adobe Stock

The new issue of the M&A Report maps trends in the M&A market in the second quarter of 2020. The full version of the report is available for download below.

The M&A market was strongly influenced by the COVID-19 pandemic in the second quarter of 2020. Many companies terminated or restricted their activities. At the same time, consumer spending and demand for oil and other sources of energy declined. The impact of the pandemic will have the consequence of systemic changes in deals.

The EY Global Capital Confidence Barometer shows that 56% of respondents from the ranks of top management anticipate that their companies will be active on the M&A market next year. At the same time, 39% of those surveyed expect a fall in prices. Investors will primarily be interested in the economic resilience of acquisition targets.

Czech Republic
In the Czech Republic, 143 transactions were reported in the second quarter of 2020. The largest number of mergers and acquisitions (41) occurred in the industrial products and services sector, followed by the real-estate sector with 39 transactions and the retail, consumer goods and entertainment sector with 19 deals concluded.

Significant activities on the Czech market include MVM Group’s acquisition of the Czech energy group Innogy from the German company E.ON.SE. The Brno-based holding company Solitea announced the largest merger on the Czech market so far this year, involving the consolidation of twenty-three companies in the Czech Republic and seven in Slovakia. C-Energy Planá acquired a majority stake in Teplárna Tábor. ČEZ Group is selling its share in the Israeli company CyberX. Czech Aircraft Group took control of the light sport aircraft manufacturer Czech Sport Aircraft. Agrofert is selling some of its bakeries that fall under PEK Group. Detailed information on selected mergers and acquisitions is available in the attached report.

The M&A Report also contains news from the CzechLink capital-participation project, which has been in operation since August 2018. The project supports mergers, acquisitions and joint-venture partnerships between local and foreign investors and domestic parties interested in investments. It also provides an overview of anonymised companies registered in the CzechLink project.

The M&A Report is published in electronic form on a quarterly basis. The next issue will be available in the third quarter of 2020. If you would like to receive the report directly, please contact czechlink@czechinvest.org.