Deals of the year

The fields that attracted investments this year included energy, communication, retail and financial services. Yet mergers and acquisitions reached just 60 percent of the 2009 level. Specialists say that the M&A market will see a boost in 2011, but only if the gap between players’ expectations can be closed. With cash on the table – next year two funds worth EUR 25 million each financed by the European Investment Fund (EIF) will be created – it remains to be seen where investors will look for profits. Consultants are betting on energy, healthcare, food and beverages, financial services and the media.

Otilia Haraga, Dana Verdes

Energy, followed by TMT (telecom, media and technology) and financial services are the areas which lured foreign investors this year, according to Hein van Dam, partner in charge of Deloitte Financial Advisory, Balkan cluster.

Radu Stoicoviciu, partner of transactions at PricewaterhouseCoopers (PwC) Romania, added, “This year, the most active sector was retail, as far as M&A are concerned. It was followed by medical services, both for the number of transactions and their value.”

“Might work” as Romanians say, considering the political and financial lack of predictability Romania has had to face this year.  But while specialist views differed in terms of the field that brought foreign investors onto the local market, their opinions merge when it comes to the year’s statistics for M&A.

The PwC partner said, “This year, the M&A market posted a decline in the number of transactions and volume, the latter representing approximately 60 percent of the figures posted in 2009.”

Hein van Dam said that the local market looked toward consolidation rather than expansion this year, due mainly to the uncertainties over the macro-economic background.

“Compared to other regional markets, Romania fares poorly both in terms of number of deals and their cumulative value,” said the Deloitte official.

 

Why fewer deals this year?

The M&A market was impacted by the low number of attractive companies up for grabs and also by the gap between the expectations of sellers and buyers regarding the price of the transaction.

Stoicoviciu said, “Next year the difference between these levels of expectation should shrink, and consequently, the M&A market will be re-invigorated.”

Hein van Dam also told Business Review, “The valuation gap between the sellers and the potential buyers remained wide, which resulted in the fewer deals concluded.”

He added: “Local investors focused on the domestic consolidation of their businesses. Next year, we expect things to move towards balance-sheet optimization, with non-core asset disposals.”

 

M&A market forecast

Energy, healthcare, food and beverage, financial services, and media are the fields the Deloitte partner expects to raise foreign investors’ interest this year.

“We think that a much more substantial number of transactions will take place in the medical services domain in 2011. Retail will also remain active in M&A. We might also witness more fervent activity in telecommunications and pharma,” said Stoicoviciu.

Market specialists say that one problem, so far, has been the lack of private equity financing for relatively small amounts, with funds focusing on investing in companies that had the capacity to absorb large funds. “An important step was the formation of the venture capital fund raised by Enterprise Investors, and next year two funds

 financed by the JEREMIE program of the European Investment Fund (EIF) will be created. The funds – which will be worth EUR 25 million each – will be able to make small investments, of up to EUR 1.5 million per year in each company,” said Irina Anghel,   general secretary of the South Eastern Europe Private Equity Association (SEEPEA).

 

Who’s looking to buy?

Specialists say that it is mainly local players and individuals and private equity entities who are prospecting the local market for M&A opportunities.

“Private equity funds have substantial capital to deploy. Transactions are taking longer to craft and I would argue it’s less about money and more about the quality of opportunities, greater analysis of potential risk-reward and the concerns related to the macroeconomic context,” said Hein van Dam.

“ There are especially financial investors of the private equity type who have funds available and are ready to invest in Romania, if the companies on sale are attractive enough and the owners have reasonable price expectations,” added the PwC partner. 

Romania’s economy is not developed enough to attract funds specialized in specific sectors, say experts.

Romania and the region are home to mainly generalist funds, which study the overall market and invest in companies with growth potential regardless of the sector.

“Most likely, the forthcoming acquisitions will continue to be well known companies, leaders in their segment, which generate stable and predictable results and do not have a high level of debt,” said Anghel.

She added: “In the long term, five to ten years, Romania has the potential to become an important driver of growth and investment funds are waiting for this. Our members have more than EUR 4 billion under management and they will continue to invest in the region.”

The following pages cover the main moves on the local M&A market over the past year, with transactions broken down by sector.

 

Where information is listed as unavailable, it was not available to BR by press time.

 

FMCG

­

Kraft Foods sells Romanian business to Oryxa Capital

Value of transaction: unavailable

Legal team buyer: unavailable

Legal team seller: DLA Piper

 

US food giant Kraft Foods announced the sale of the Cadbury-owned Kandia-Excelent chocolate and cake business in Romania to Oryxa Capital investment fund. Cadbury acquired the Romanian sweet maker in 2007, but Kraft was forced to divest of it under EU competition rules following its contentious takeover of the UK confectionery giant in February this year. The sale includes Kandia-Excelent brands (Rom, Magura, Kandia, Laura, Sugus and Silvana and others), related trademarks and the manufacturing facility in Bucharest. The US company did not disclose the financial details of the deal but said that it would retain the global Cadbury brands, including Halls cough sweets.

 

Sorin Minea becomes majority shareholder of Angst

Value of transaction: unavailable

Legal team buyer: unavailable

Legal team seller: unavailable

 

Sorin Minea, a Romanian entrepreneur on the butchery market, took over 60 percent of the stake held in Angst by his Swiss partner, Urs Angst. This makes Minea majority shareholder of the company – initially he held 15 percent – with over EUR 50 million in turnover and a 22-store chain. Minea did not reveal the value of the transaction, but says the company’s assets were put at around EUR 20-22 million last year, whilst the value of investments made by the Angst family in the meat producer amounts to around EUR 10 million.

 

P&G sells Wella Romania toInterbrands

Value of transaction: confidential

Legal team buyer: Tuca Zbarcea & Asociatii

Legal team seller: In-house lawyers

 

FMCG giant Procter & Gamble (P&G) offloaded its local division of professional products designed for hair salons, selling Wella Romania to Interbrands. Wella is the biggest player on its market segment, products created exclusively for distribution in hair salons. Interbrands, which has been distributing P&G products for 17 years, thus takes over the distribution of hair dye, shampoos and other Wella hair care products, System Professional and Londa Professional to around 3,000 hair salons. The company had EUR 12 million in sales in 2008 and 70 employees. Interbrands entered the Romanian market in 1993, and handles the distribution operations of Cadbury, Nestle and Henkel.

 

Caroli merges with Campofrio

Value of transaction: unavailable

Legal team Campofrio: NNDKP

Legal team seller: unavailable

 

Caroli Foods Group and Campofrio Food Group signed a merger contract establishing a joint venture with operations in Romania and Bulgaria, the Republic of Moldova, Serbia, Ukraine and Turkey. The newly merged entity was to be named Caroli Foods Group. The combined turnover of the two companies is in excess of EUR 120 million and together they control a market share of over 16 percent. Romania will remain the main outlet market of Caroli Foods Group, but the new joint venture also intends to develop its presence in SEE. Caroli Foods Group will hold 51 percent of the new company’s stake and Campofrio Food Group will control the other 49 percent.

 

Bongrain buys Delaco

Value of transaction: unavailable

Legal team buyer: Biris Goran

Legal team seller: unavailable

 

French dairy producer Bongrain took over the majority stake in Romanian dairy producer Delaco, formerly controlled by local businessman Tudor Comaniciu. Prior the deal, Delaco Distribution’s shareholders were Tudor Comaniciu, (a 56.16 percent stake), Dragos Comaniciu (a 28 percent stake), Adrian-Victor Vartolomei (14.08 percent) and Romulus Dumitru (1.75 percent). Delaco was set up by Romanian investor Tudor Comaniciu in 1996 as a family business. Financial details were unavailable . Bongrain, which sells the Apetito and Caprice de Dieux brands in Romania, is currently consolidating its business in Central and Eastern Europe.

 

Alka Pro sells Nutline to Intersnack Group

Value of transaction:  over EUR 10 mln (media estimations)

Legal team buyer: unavailable

Legal team seller: Musat&Asociatii

 

Intersnack acquired Nutline from its rival company, Alka Grup. Nutline was created by Israeli businessman Amir Krenzia, the owner of Alka Group, and it had a share of 38 percent last year on the market of seeds and dry fruit that was estimated at EUR 50-70 million. The Nutline division posted a turnover of EUR 22 million and a profit of EUR 1.2 million last year.

 

La Fantana purchases Rokor Ecostyle

Value of transaction: unavailable

Legal team buyer: unavailable

Legal team seller: unavailable

 

La Fantana acquired Rokor Ecostyle and reached a market share of over 80 percent, becoming leader on the segment of water purification systems. The value of the transaction was unavailable  but when the deal was signed, the enterprise value of Rokor Ecostyle was EUR 4.35 million. Following the move, Rokor Ecostyle will run under the same brand as a dedicated division for the water purification segment of La Fantana. The firm has 600 employees in Romania and Serbia. It has two bottling units in Romania and one in Serbia. In Romania, La Fantana has 25,000 corporate clients and institutions.

 

Julius Meinl buys back Kandia

Value of transaction: confidential

Legal team buyer: unavailable

Legal team seller: unavailable

 

The Austrian family Meinl, owner of the Julius Meinl coffee brand, took over EUR 1.5 million of losses when it acquired chocolate producer Kandia. Kandia-Excelent reported a EUR 33.4 million turnover last year and a negative result of EUR 1.5 million. In its three years in the hands of British Cadbury, Kandia did not manage to turn a profit, reporting cumulated losses of almost EUR 8 million from 2007-2009. Last year’s financial results in terms of losses were similar to those of 2007, the year when Julius Meinl sold Kandia-Excelent to Cadbury for EUR 100 million.

 

Noriel Group sells minority stake to Axxess Capital

Value of transaction: EUR 7 million

Legal team buyer: in-house lawyers

Legal team seller: Tuca Zbarcea & Asociati

 

Balkan investment management company Axxess Capital purchased a minority stake in Noriel Group, a leading producer of popular games and toys in Romania. The investment was made via the Balkan Accession Fund, which is managed by Axxess. The deal gave Balkan Accession Fund a 40 percent stake in Noriel through the purchase of both existing shares and newly issued shares. This paved the way for Noriel to expand retail operations outside the local area and the country, with hopes of making it a major player in the Balkan region.

 

Sofiproteol/Saipol buys Romanian Expur

Value of transaction:

estimated at EUR 80 million

Legal team buyer: in-house lawyers

Legal team seller: Tuca Zbarcea & Asociatii, Cotty Vivant Marchisio & Lauzeral

 

French company Sofiproteol acquired Romanian vegetable oil producer Expur Urziceni, controlled by the Swiss group Alimenta. The acquisition was completed via the Saipol subsidiary of Sofiproteol. The European Bank for Reconstruction and Development granted EUR 80 million to Expur in November to achieve its development plans by introducing new products on the market. EUR 60 million of this sum will be used for purchasing seeds. In 2009, Expur posted a turnover of EUR 86 million.

 

MEDIA

 

Publicis Groupe buys Publicis Romania, Focus Advertising and Publicis Events

Value of transaction: unavailable

Legal team buyer: unavailable

Legal team seller: unavailable

 

Publicis Groupe announced the acquisition of three of its long-term affiliates – Publicis Romania, Focus Advertising and Publicis Events – in a move to strengthen its presence in the Balkan region. The three entities were to operate under an integrated communications agency to be named Grupul Publicis Communications Services Bucharest. The agency was to become part of the Publicis Worldwide global network. Teddy C. Dumitrescu, the agency’s founder and CEO, was to continue to lead the agency as CEO and report to Tomasz Pawlikowski, CEO Publicis CEE and Russia. Grupul Publicis Communications Services Bucharest offers advertising, branding, strategy, creative, production, sales promotions, event marketing and digital services. Founded in 1994, the agency has been a partner of Publicis Worldwide since 1995.

‘This deal completes our Balkan expansion. We’ve had close links with the agency and its strong management team for ten years and it’s great to finally get married,” said Richard Pinder, COO of Publicis Worldwide.

 

Bobby Paunescu buys Evenimentul Zilei and Capital

Value of transaction:

EUR 4-8 million (market sources)

Legal team buyer: unavailable

Legal team seller: unavailable

 

Evenimentul Zilei and Capital, publications in the Swiss Ringier portfolio, were bought by businessman Bobby Paunescu. He additionally owns B1TV, VOX News and local paper Gazeta de Sud. The value of the transaction was unavailable , but sources estimate it at EUR 4-8 million. Both publications have seen their results fall in recent years. The Evenimentul Zilei newspaper business made between EUR 4-5 million in 2009, while Capital reported EUR 1.5-2 million. In 2007, the revenues of the two publications were almost double, and the final result was positive. Ringier Romania still has in its portfolio publications such as tabloid Libertatea, TV Mania, Unica, Bolero, Bravo and Lumea Femeilor.

 

GED buys Infopress Group

Value of transaction: EUR 12 million

Legal team buyer: Vilau & Mitel

Legal team seller: Biris Goran

 

Spanish private equity firm GED bought 92 percent of the share capital of Infopress Group. Founded in 1990 as the publisher of Odorheiu Secuiesc newspaper, Infopress has grown steadily into the largest printing company in Romania and South-East Europe and among the leaders in Eastern Europe. GED also owns in Romania travel agency Happy Tour, telecom store chain Fonomat, medical equipment provider Diamedix, Eurobusiness (as co-owner) and security services company Rosegur Holding.

 

Asesoft takes over Realitatea Catavencu management

Value of transaction:

EUR 75 million over next five years

Legal team buyer: unavailable

Legal team seller: unavailable

 

Sebastian Ghita, owner of local IT&C group Asesoft, became the new manager of Realitatea Catavencu media group, pouring an estimated five-year investment of EUR 75 million into the company. The takeover was aimed to help the media group make the necessary efforts to adopt HD technology. Sorin Ovidiu Vantu will remain a shareholder in the company.

 

TELECOM

 

Romtelecom acquires New Com

Value of transaction: unavailable

Legal team buyer: unavailable

Legal team seller: unavailable

 

Romtelecom completed the acquisition of New Com Telecomunicatii. The value of the deal and number of subscribers that Romtelecom gained were not made public. However, an independent report carried out by Euroval in October 2009 evaluated the five New Com networks at 26,000 clients and USD 9 million. The transaction was made through NextGen Communications, a telecom provider that is fully owned by Romtelecom. In March 2009, New Com sold 30,000 customers to NextGen Communications. Several months later, it sold another 30,000 clients to RCS&RDS in a transaction that was estimated at the time to be worth EUR 5 million. New Com Telecomunicatii was founded in 2007 in Cluj. The shareholders of the company were investment firm Capital Partners and two other investment funds.

 

GTS buys Datek

Value of transaction: unavailable

Legal team buyer: unavailable

Legal team seller: unavailable

 

Telecom player GTS Central Europe acquired the Romanian firm Datek, marking the completion of a contract signed in December. GTS CE will add Datek to its existing Romanian operations, creating a combined business with total annual revenues exceeding EUR 25 million. The move puts GTS in the top three alternative telecom operators on the local market. Last year, GTS posted a turnover of EUR 19.8 million and an EBITDA of EUR 5.2 million. The takeover will see it double its number of employees. Currently Datek has a staff of 106 while GTS employs 115 people in Romania.

 

INSURANCE­

 

AXA picks up Omniasig Life

Value of transaction:  under EUR 10 million (media estimate)

Legal team buyer: unavailable

Legal team seller: unavailable

 

With the takeover of Omniasig Life, AXA entered the Romanian life insurance market, in line with its objective of accelerating the development of its activities in emerging countries, notably in Central and Eastern Europe. AXA took over a major share package in Omniasig Life, which had up to that point been owned by Vienna Insurance Group. After the transaction, the company became AXA Life Insurance and all the operations were to be coordinated under the AXA umbrella.

 

Eugen Voicu buys back Aviva Investors

Value of transaction: unavailable

Legal team buyer: Tuca Zbarcea&

Asociatii

Legal team seller: unavailable

 

Three years after selling Aviva Investors (Certinvest at that time) to British group Aviva, Eugen Voicu, the company’s CEO and founder, bought back his majority stake. Voicu said that directly or indirectly he would have 99.9 percent of the company. The asset management company rebranded as Certinvest in order to mark the change but will continue its partnership with Aviva. Voicu founded Certinvest in 1994 and sold it in December 2007 for a value which was kept confidential at that time but was estimated at around EUR 3 million. Throughout this time he has served as the company’s CEO, a position he will continue to hold.

 

HEALTHCARE

 

Medlife gets Brasov Medical Center

Value of transaction: over EUR 3 million

Legal team buyer: Popovici Nitu and Asociatii

Legal team seller: Vernon, David and Asociatii

 

Local medical services provider MedLife acquired 80 percent of Policlinica de Diagnostic Rapid SRL in Brasov in a transaction that totaled in excess of EUR 3 million. The medical center in Brasov was rebranded as MedLife – PDR following the deal. It includes a clinic, two medical laboratories and has about 200 medical employees. MedLife-PDR has just started construction works for a hospital and clinic in Brasov. The hospital will have a capacity of 75 beds and will comprise five levels. MedLife has so far invested more than EUR 2.5 million in the hospital.

 

Centrul Medical Unirea buys Euroclinic

Value of transaction: unavailable

Legal team buyer: RTPR Allen&Overy

Legal team seller: Kinstellar

 

Centrul Medical Unirea (CMU) acquired Euroclinic Hospital and Euroclinic Medical Centers from insurer Eureko. Eureko Asigurari has approximately 8,000 insured clients who will have access to the medical facilities of the new group. The two parties agreed not to disclose the value of the transaction. This year, the two companies will have a cumulated turnover of EUR 30 million. Euroclinic will keep its name. Currently, Euroclinic runs a hospital and three medical centers, and has 350 employees. Last year, it posted revenues of EUR 8 million.

 

Fresenius acquires dialysis centers in Deva and Satu Mare

Value of transaction: up to EUR 5 million per center (media estimate)

Legal team buyer: unavailable

Legal team seller: unavailable

 

Fresenius NephroCare Romania acquired two dialysis centers, one in Deva and one in Satu Mare. Even though Fresenius did not disclose which particular centers it bought, media information referred to two of the Nefromed centers as Fresenius was in the list of shareholders of Nefromed SM and Nefromed HD. The shareholder of Nefromed Dialysis Centers is Lokxen Trading Limited registered in Cyprus. These takeovers are part of Fresenius NephroCare’s expansion strategy. Fresenius posted a turnover of EUR 23.8 million last year.

 

Advent obtains majority stake in CMU

Value of transaction: EUR 40 million

Legal team buyer: unavailable

Legal team seller: unavailable

 

Investment fund Advent International bought an 80 percent stake in private medical services supplier Centrul Medical Unirea. In total, 12 firms were interested in the deal. Only eight were selected for the preliminary stage, two of which were shortlisted. Investment fund 3TS Capital Partners, which was previously the second largest shareholder within the firm, along with the company founder, Wargha Enayati, exited from the deal. 3TS used to hold 39 percent of the shares in CMU, with Enayati holding the rest. The CMU founder gave up his major shareholder position, with Advent now owning the majority stake in CMU.

 

INDUSTRY

 

Carabulea sells 34.5 percent in Bricomat and majority stake in Transcom

Value of transaction: RON 9.55 million

Legal team buyer: unavailable

Legal team seller: unavailable

 

Romanian businessman Ilie Carabulea sold a 34.5 percent stake in Bricomat Sibiu on Rasdaq for RON 8.5 million and the majority stake in Transcom Sibiu for RON 1.05 million. Bricomat is 97.47 percent controlled by Ilie Carabulea, who directly holds an 84.46 percent stake, and through Atlassib with 13 percent. The stock of road transport company, Transcom, was transferred in a 62.43 percent package.

 

Mechel buys Laminorul Braila

Value of transaction: EUR 9.4 million

Legal team buyer: unavailable

Legal team seller: unavailable

 

Russian mining and steel company Mechel acquired 100 percent of the shares in Donau Commodities, which holds 90.91 percent of Romanian steel plant Laminorul Braila. The acquisition value is estimated at EUR 9.4 million.

This is the only plant in Romania manufacturing the special profile (bulb bar) which is used in shipbuilding. In 2009 the plant manufactured more than 50 thousand tons of structural shapes, delivered mainly to Western and Eastern Europe.

The acquisition of Laminorul Braila will allow Mechel to significantly extend its product range and achieve synergy with its other Romanian subsidiaries, namely, Mechel Targoviste, Mechel Campia Turzii, Ductil Steel Buzau and Otelu Rosu, which are specialized in the production of longs and hardware.

 

RePower buys 80 percent of shares in Elcomex

Value of transaction: EUR 15 million

Legal team buyer: Musat&Asociatii

Legal team seller: unavailable

 

Swiss company Repower bought an 80 percent stake in Romanian electricity distribution company Elcomex EN. Elcomex posted revenues in excess of EUR 70 million in 2009 and before the deal, it was totally controlled by businessman Ion Grecu.

The acquisition agreement stipulates that Repower will purchase the remaining 20 percent stake in the company. Following this takeover, Repower would supply electricity to clients in the SME segment.

Repower’s main shareholders are Swiss canton Graubunden, with 46 percent of the shares, Alpiq Holding with 24.6 percent of the shares and EGL AG with 21.4 percent of shares.

 

ButanGas buys Romconstruct Top

Value of transaction: unavailable

Legal team buyer: unavailable

Legal team seller:  unavailable

 

 ButanGas Romania, part of liquefied petroleum gas company ButanGas Grup, bought a 90 share package in Romconstruct Top, a firm specialized in electricity production, in June.

The remaining 10 percent is controlled by Emanuel Muntmark, a wind farm developer. Romconstruct Top – based in Constanta – reported a EUR 1.3 million turnover in 2009, and has 10 employees, according to Finance Ministry information.

ButanGas Romania’s main shareholder is ButanGas SPA, with 93 percent, while Propangas AG controls a 7 percent stake.

 

 

Deal Value: EUR 90 million

Legal adviser to buyer: Musat & Asociatii

Legal team seller:  unavailable

 

Rompetrol Group has increased its stake to 98.61 percent of the share capital of Rompetrol (RRC), after it attracted takeover offer 5.38 percent.Rompetrol will pay 85.31 million lei for the subscribed shares in the offer, but the total amount to increase its share from 75.99 percent to 98.61 percent is EUR 88.06 million.  

 

AUTOMOTIVE

 

New Kopel buys Ipso-Renault dealership

Value of transaction: unavailable

Legal team buyer: NNDKP

Legal team seller: unavailable

 

Israeli group New Kopel bought the Dacia-Renault dealer IPSO Otopeni in the first half of this year. New Kopel turned the dealership into an Opel center, through Union Motors Car Sales firm. The company manages a total area of 4,000 sqm which includes a showroom, deals with service and spare parts and has 100 employees. The overall investment in the new center reached over EUR 6 million, company officials said. The Opel network currently includes 42 sites nationally, 40 percent of sales being made in Bucharest.

 

Leoni takes over AEES Power Systems’ Romanian plant in Beius

Value of transaction: unavailable

Legal team buyer: unavailable

Legal team seller: Musat & Asociatii

 

Leoni, the leading provider of cables and cable systems, acquired the AEES Power Systems Group plant in Beius, situated in north-western Romania. AEES Power Systems Group is specialized in the design, development and production of electrical and electronic distribution systems for cars. The additional business volume reaches a single-digit million Euro total per year, according to Leoni officials. The plant was acquired as AEES Power Systems restructured its European operations in early 2010. In connection with the restructuring, Leoni continued to supply cable harnesses for batteries and chassis to two truck manufacturers.

 

Kromberg & Schubert takes over a factory in Nadab

Deal value: unavailable

Legal team buyer: unavailable

Legal adviser to seller:

Musat & Asociatii

 

Cable manufacturers Leoni, Kromberg & Schubert and Sews took over three local factories of the American factory Alcoa, located in Nadab (Arad), Caransebes (Caras Severin) and Beius (Bihor). The total value of the business that Alcoa had in Romania was of EUR 30 million and almost 5,000 employees estimated in 2008. Platinum Equity investment fund sold the three factory previously owned by Alcoa, with all the means and employees included. The largest factory, located in Nadab, was then taken over by German components manufacturer, Kromberg & Schubert.

 

SEWS takes over a factory in Caransebes

Deal value: unavailable

Legal team buyer: unavailable

Legal adviser to seller: Musat & Asociatii

 

Cable manufacturers Leoni, Kromberg & Schubert and Sews took over three local factories of the American factory Alcoa, located in Nadab (Arad), Caransebes (Caras Severin) and Beius (Bihor). The total value of the business that Alcoa had in Romania was of EUR 30 million and almost 5,000 employees estimated in 2008. Platinum Equity investment fund sold the three factories previously owned by Alcoa, with all the means and employees included.  

 

RETAIL

 

Mercadia Holland buys MiniMAX Discount

Value of transaction: unavailable

Legal team buyer: unavailable

Legal team seller: unavailable

 

Mercadia Holland BV took over the full shareholding of miniMax Discount, the discount retail network operator, as part of the group’s development strategy on this market.

The value of the transaction was unavailable , but market estimates placed it at a few million euro.

The previous owners of miniMax Discount were Austrian group Real4You, together with Rainer Exel, who runs the company, and Andreas Kampf, active on the sales segment. Mercadia Holland BV – controlled by businessman Dinu

Patriciu – owns the majority share

packages in Mic.ro Retail, Bet Cafe Arena and iLearn.

 

Lidl buys competitor Plus in Romania and Bulgaria

Value of transaction:

estimated EUR 80 million

Legal team buyer:

Norr Stiefenhofer Lutz

Legal team seller: unavailable

 

German discount supermarket chain Lidl, which entered the Romanian market in 2003, bought the local low-cost chain Plus from German owner Tengelmann. Lidl took over the entire Plus business in Romania and Bulgaria, including all employees. Plus entered the Romanian market in 2005 and has opened 96 stores throughout the country so far. Two more shops in Rosiorii de Vede and Husi will be up and running soon, according to the retailer.

Each Plus store covers 1,500 sqm, out of which 1,200 sqm represents sales area. Lidl is part of the German Lidl & Schwartz Group, which already runs Kaufland stores in Romania. The company previously said it was planning to open its first stores in Romania in 2010 but has not yet done so.

 

IKEA Group buys local franchise from group of investors in SEE expansion bid

Value of transaction:

unavailable

Legal team buyer: unavailable

Legal team seller: unavailable

 

Swedish retailer and furniture producer IKEA Group acquired its local franchise from a group of investors. The local franchise had been running an IKEA store for the last three years. It was held by Moaro Trading, which sold the store’s operating rights and franchise. Moaro Trading had obtained the franchise rights from Inter IKEA Systems BV, the global IKEA franchiser. The acquisition was in line with IKEA Group’s future expansion plans in South Eastern Europe. The group includes all IKEA operations: the Swedwood industrial group, distribution and warehousing divisions and the companies that own stores in countries around the globe. IKEA has 301 shops in 37 countries, of which 268 belong to the IKEA Group, the franchise holder. The remaining stores are owned and run by other franchisees. Moaro Trading, which opened the first IKEA store in Romania in 2007 after a EUR 10 million investment, was controlled by Dutch consortia Engma, Turkmall and Inter IKEA Systems. The local media named Romanian investor Gabriel Popoviciu as the main investor in the Swedish furniture firm’s business in Romania. Popoviciu has invested in the Baneasa real estate project in north Bucharest, which includes the IKEA store in its retail area.

 

EDUCATION

 

Tender buys majority stake in Codecs

Value of transaction: EUR 424,747

Legal team buyer: unavailable

Legal team seller: unavailable

 

Romanian businessman Ovidiu Tender, who controls operations worth over EUR 200 million, bought a majority stake (51 percent) in training and consultancy firm Codecs for around EUR 425,000. The firm currently has a EUR 2.7 million Eximbank loan to repay, of which EUR 1.5 million is outstanding. Tender bought the majority stake to have a professional formation unit for all his employees and for the real estate aspect of the deal. Codecs owns two office buildings in central Bucharest. Tender’s most important businesses are the steam generator Vulcan Bucuresti and geological explorations company Prospectiuni. Codecs, which was formed in 1993, currently manages a training division, typography business, a foundation and an MBA program and has 25 shareholders.

 

TRANSPORT

 

Recordati Group buys ArtMed

Value of transaction: EUR 1.2 million

Financial adviser: Capital Mind

Legal team buyer: unavailable

Legal team seller: unavailable

 

Pharmaceutical group Recordati Group acquired ArtMed International, a pharmaceutical products promotion company in Romania, along with the rights to the products currently being promoted by the firm. The price was EUR 1.2 million plus an earn-out based on the gross profit of the five products under license. ArtMed was established in 2005 as a provider of specialized marketing services for companies such as Bristol-Myers Squibb and Pfizer. The company employs 30 people and will operate as a development platform for Recordati in Romania.

 

Quehenberger enters Romania by acquiring Longwin Road & Rail

Value of transaction: unavailable

Legal team buyer: unavailable

Legal team seller:  unavailable

 

Austrian transport and logistics company Quehenberger took over Longwin Road & Rail activities, through a transaction that involved the acquisition of operations in Austria and Eastern Europe.

The company operates three logistics centers in Romania, in Bucharest, Timisoara, Arad and Pitesti. Its client portfolio includes the car-parts producers Lear Corporation, Delphi Packard, Honeywell and companies in the consumer goods industry, such as Red Bull and Tchibo. Over the past year the company recorded a business volume of EUR 8 million and an operating profit of EUR 200,000.

 

Dumagas Transport sells a significant stake to Bancroft private equity fund

Value of transaction: unavailable

Lead corporate finance adviser to the seller: The Counsel

Legal team buyer: Cameron McKenna

Legal team seller:  Wolf Theiss

 

The founding shareholders of Dumagas Transport, a leading Romanian road transportation company in Romania, sold a majority stake in their company to Bancroft, a Central and Eastern European, mid-market, private equity fund manager. The transaction was completed in July 2010. Dumagas Transport engages in general and specialized transportation and holds a prominent position in controlled temperature warehousing and logistics. The involvement of Bancroft will allow Dumagas to continue developing the company’s activities across all its business lines, consolidate the group’s positions in key export markets and speed up the development of the controlled temperature warehousing and logistics markets.

 

LEASING

 

Banca Transilvania buys Medicredit Leasing

Value of transaction: unavailable

Legal team buyer: unavailable

Legal team seller: unavailable

 

Banca Transilvania (BT) became sole shareholder of Medicredit Leasing IFN – a company in which it held 38.89 percent – following the acquisition and subscription of stock in the leasing company, which specializes in medical equipment. Banca Transilvania’s stake in Medicredit Leasing IFN consists of 13,191 nominal shares with a face value of over RON 1.3 million, which is fully subscribed. Banca Transilvania is the main member of the Banca Transilvania Group, a provider of integrated financial services including banking, insurance, leasing, realty, consumer financing, factoring and business administration. 

 

DISTRIBUTION

 

Montero sells Tamisa Trading

Value of transaction: EUR 200.000

Legal team buyer: unavailable

Legal team seller: unavailable

 

Montero, a Romanian drug distributor, sold its subsidiary, Tamisa Trading, for EUR 200,000. Shares in the subsidiary were bought by the two managers of Montero responsible for pharmacy distribution.

The sale followed Montero’s insolvency, which was declared in February this year. Along with the insolvency declaration, the court was to have approved Montero’s reorganization plan, which was aimed at recovering its operations and paying off its debts over the next two years. 

Tamisa Trading was acquired by Montero in 2007. The subsidiary generated revenues of EUR 15.9 million and made a loss of EUR 900,000 in 2008.

 

ONLINE

 

Sanoma Hearst buys MagazinulDeCase.ro

Value of transaction: unavailable

Legal team buyer: NNDKP

Legal team seller: unavailable

 

Sanoma Digital Romania, a sister company of Sanoma Hearst Romania focused on digital media, acquired MagazinulDeCase.ro, Romania’s first “for sale by owner” real estate market place.

MagazinulDeCase.ro has a reputation as the most efficient real estate website in Romania, guaranteeing the highest average number of views per listing. The market place has intermediated over 4,800 real estate transactions. 

MagazinulDeCase.ro continues to increase its number of new listings, although the real estate market in Romania is currently in decline. 

With this transaction Sanoma took the next step towards its objective of becoming a leading digital media company in Romania in addition to its prime position in consumer magazines. 

 

GED gets hands on Paravion.ro

Value of transaction: unavailable 

Legal team buyer: Tuca Zbarcea &

Asociatii

Legal team seller:  Sfiraiala & Asociatii

 

GED acquired Paravion.ro, the leading online travel service provider in Romania, from travel company Millenium Tour. The acquisition took place through GED-owned company Happy Tour. Paravion.ro had eight employees.

It posted a turnover of EUR 5 million and estimated EUR 7 million for this year. The move was part of GED’s strategy in the tourism sector, started in December 2007 with the acquisition of Happy Tour.  The strategy includes the consolidation of its position as a leading travel services provider in Romania, both offline and online, allowing GED to extend operations to other Eastern Europe countries.

 

Enterprise Investors buys major stake in Netrisk.hu

Value of transaction: EUR 23 million

Legal team buyer: unavailable

Legal team seller:  unavailable

 

Polish Enterprise Fund VI (PEF VI), a private equity fund administered by Enterprise Investors, acquired a major stake in Netrisk.hu, the largest online broker of general insurance.

Following the transaction, Enterprise Investors (EI) committed to expand Netrisk.hu in Hungary, Romania and Central and Eastern Europe. Netrisk.hu was founded 15 years ago and deals in CTP, CASCO, home and travel insurance. Currently, it has 770,000 users. In November 2009, EI fully bought out Profi Rom Food Group, one of the largest sup

 

 

Study Allen&Overy: M&A activity in CEE on the rise

The volume and number of major M&A transactions has risen in Central and Eastern Europe in the first three quarters of 2010 compared to 2009, says the Allen&Overy M&A Index. According to the report, there are still significant differences between the expectations of sellers and buyers, which makes recovery in the M&A sector difficult in certain sectors and regions. The cumulated value of CEE transactions was over USD 50 billion in the first 3Q of 2010.

Activity was generated in the past year and a half especially from selling non-core assets or assets located in non-core regions of companies. Deals came from three main

areas: privatizations, telecommunications and takeovers of family businesses.

According to the report, M&A activity in Romania was focused on transactions under USD 100 million, especially in retail, pharmaceuticals, and medical services. 

In Hungary, Romania and Ukraine, M&A activity is shaped by currency difficulties and problems in obtaining bank finances. In this context local companies are looking to get their financing from the capital markets or attract mezzanine investors.

One part of the region where M&A activity has picked up since the second quarter of 2010 is Russia. This reflects the recovery in the price of oil and the Russian economy. The most active sectors were oil and gas, energy and utilities, and manufacturing. Foreign strategic investors are driving activity here, particularly Chinese and Indian energy companies, along with Russian firms looking to consolidate their market share, the report found.

Privatizations in Poland and the declared strategy of the government there have been a significant source of activity in the region, and Polish M&A have reached a new level of complexity. Deals made there involve the consideration of public M&A.

In the Czech and Slovak Republics, budget deficits are driving sales of government assets, the report adds, with intense activity going on in the energy and utilities sector, which has seen privatizations, significant asset swaps and a lot of activity around renewables. Romania stands out with smaller deals in the pharma and healthcare sectors.

One sector that has been more prominent is TMT. The consumer and food and beverage sectors have also been active, having seen large regional private equity houses divesting assets purchased in 2005 and 2006.

The telecom sector is expected to produce further large disposals of non-core assets, according to the report.