InVenture presents the annual results of a study of the development of the private equity market, venture transactions, mergers and acquisitions M&A in Ukraine in 2023: the largest M&A transactions, forecast for the development of the M&A market, corporate investments and investment plans for 2024.
Against the backdrop of a critical drop in the investment market in the first year of the war, the overall investment picture in Ukraine in 2023 has changed somewhat.
According to InVenture estimates, the volume of announced and completed mergers and acquisitions (M&A) transactions in Ukraine, including corporate transactions, venture transactions in the technology sector, as well as privatization transactions and sales of collateral assets at the end of 2023 amounted to $1.7 billion. Given the low publicity and transparency of transactions, we assume that the volume of the M&A market in Ukraine in 2023 was slightly higher.
Compared to 2022, the total volume of M&A transactions in 2023 increased 5 times, but is 1.5 times lower than pre-war figures ($2.7 billion in 2021).
Based on the results of 2023, it can be stated that the M&A market has somewhat revived. The number of M&A transactions in Ukraine worth more than $0.5 million in 2023 compared to 2022 also increased and amounted to 90 transactions (versus 54 transactions in 2022), but their number is still lower than in the pre-war period (120 transactions in 2021).
Among the main characteristic trends of the M&A market in 2023, the following can be identified:
1. Ukrainian IT/telecom sector and venture industry continues to demonstrate investment attractiveness even during the war. About 50% of transactions on the Ukrainian M&A market took place in this sector. The main transactions are purchases of outsourcing IT companies, as well as investment rounds to attract financing by technology companies with Ukrainian founders.
2. Forced transactions for the sale of assets at stress prices due to the need to repay accounts payable, as well as, in some cases, for political reasons.
3. In the agricultural sector, there was some activity in the purchase of assets in the field of logistics (terminals, dry ports, elevator capacities) in order to optimize grain delivery. Agricultural enterprises with a land bank (mainly in the western and central parts of Ukraine) were also in demand among investors.
4. Industrial and logistics properties were also in demand among investors in the market in 2023. Most of these transactions do not fall into the public information sphere.
The full InVenture report can be found by the link.