Private Equity: Are CEE Opportunities Still a Good Bet?

June 4, 2009

Prague, Czech Republic (Press Release) - Private equity activity has been alive and robust in Central and Eastern Europe for some time, but last year’s economic downturn may have caused some investors to pull back a bit. The question for funds with capital still available is whether or not CEE opportunities are still a good bet. Savvy investors who keep up with the news should have plenty of reason to think so.

Invest-IQ (www.invest-iq.com), one of the largest private equity news platforms in CEE, has reported quite a bit of encouraging news lately. The markets show a good amount of activity including funds that are announcing new investments, others announcing exits, and even private equity firms starting fundraising.

Among new investments, Invest-IQ reported on Arx Equity’s acquisition of Lexum Group; the deal to bring Noves Okna into the Penta Investments portfolio, including Penta’s plans to invest EUR 3 million in the growth and hiring of Noves; and BaltCap’s EUR 6 million purchase of Hotline Group.

Two noteworthy exits reported by Invest-IQ are Equest’s exit of Avto Union and Lion Capital’s exit of Russian Alcohol. While the Equest deal was due in part to a slowdown in the automotive industry, the sale demonstrates the need for funds to stay within their core investment sectors. The Lion Capital deal is a great example of a successful and profitable exit by one of CEE’s leading funds.

One of the most surprising and encouraging stories was the recent announcement by Dragon of their newly launched Europe Virgin Fund. With Dragon’s initial investment and interest expressed by the EBRD, the new fund suggests more opportunities becoming available in the CEE region. Invest-IQ also reported the new $300 million CIS Opportunity Fund from Alpha Associates.

The news seems to indicate there is reason to continue investing in Central & Eastern Europe. Private equity has been building successful business and should continue to do so for the foreseeable future.

For more information please visit http://www.invest-iq.com