“Global numbers indicate that 2023 was the slowest year for mergers and acquisitions (M&A) in the last decade, as reported by Bloomberg Adria.
When comparing the merger and acquisition activity in Serbia in 2023 with the previous three years, there is no significant slowdown in terms of the number of transactions, says Damir Dimitrijević, a senior manager at EY. “Regarding transactions involving limited liability companies, there were about 50 in 2021, and in 2022 and 2023, we are talking about 70 companies.”
The main theme of the previous year was inflation, to which a response was provided through restrictive monetary policies. Investors had already factored in inflation and interest rate growth into their company valuation models earlier, but sellers’ valuation expectations adjusted with a delay, states Dimitrijević. “However, in the past 12 months, that gap has been narrowing, and expectations are gradually adjusting. I believe that in 2024, there will be further reduction of this gap, resulting in a higher number of successful transactions in Serbia and the region.”
Dimitrijević adds that the countries from which investors came to Serbia in 2023 to acquire companies were Germany, Austria, Switzerland, and the USA.
The most attractive sectors for acquisition in 2023 remain the technological and energy sectors. “The percentage of transactions related to IT stands at about 30 percent. Furthermore, the entire world is going through an energy transition, with a focus on renewable energy sources. In addition to these two sectors, I would mention the private healthcare sector.”
One of the ways for global corporations to remain competitive and innovative is through M&A activity. “In 2024, this activity will be driven by new technologies, consolidation, and active involvement of private equity funds. We will see decarbonization, digitalization, and strengthening of supply chain resilience as key factors motivating M&A in 2024,” concludes the Bloomberg Adria article.”
