Despite the Crisis, M&A in Poland Marches On

The EU’s main economic driver, Germany, had been labelled the “sick man of Europe” by many. German Finance Minister Christian Lindner’s rebuttal was measured when he relabelled his country a “tired man”. His colleague Economy Minister Robert Habeck was less diplomatic, claiming that Germany was “in troubled waters” – he had previously said Germany was in a “dramatically bad” situation.

Deutsche Welle claimed the German government was pursuing a misguided economic policy, leading to deindustrialisation and forcing companies to move production abroad. A prime example was 125-year-old Miele, a hitherto symbol of German quality. Miele made the decision to move its household appliance production to Poland. Miele’s owner cited attractive electricity prices, reduced bureaucracy, and more favourable building regulations as the reasons behind the move.

Europe’s Odd Man Out

The Polish economy continues to attract interest. The recent general election proved a surprise, with Poland being the exception to what appears to be the current European rule – a centrist-liberal coalition came to power rather than a conservative, right-wing-leaning party.

This change of direction has had practical knock-on effects on the already positively charged M&A market, which powered through 2023. Recent reports from KPMG and Grant Thornton stated that TMT continued to play a leading role last year, whilst innovative industries (e.g. medical and biotechnological) were valued highest in monetary terms.

Those investing in Poland seem to be primarily focused on mature companies (78%) and companies in the growth phase (57%). Only 9% are startups – investors, like Poland’s financial sector, are looking for solid and stable investments. It comes as no surprise, therefore, that 75% of M&A transactions in Poland took place in partnership with an industrial investor.