Private equity funds invested almost 200 million euros in the first six months of the year, 25% less against the same time last year. Their main areas of interest were constructions and other related sectors, according to the statistics of South Eastern Europe's Private Equity Association (SEEPEA).
As a result, Romania replaced Poland, which was the most important market in Central and Eastern Europe, on the map of the private equity investments. Poland attracted 80 million euros in investments from private equity funds in the first half of the year, while in Bulgaria the funds invested approximately 50 million euros, SEEPEA statistics show.
"Romania was the star of the private equity funds in the first half. Even though the volume of investments attracted was lower than last year, the Romanian private equity market is healthy despite the financial crisis", Robert Luke, SEEPEA chairman said.
The reduction of private equity investments on the domestic market comes after a 400% increase, which reached a total volume of 476 million euros in 2007.
"The main causes that led to a decline in investments have to do with the evaluation multiples of the companies whose values shot through the roof. Starting from the second half of the year, the expectations of local entrepreneurs about the value of the companies they run went down somewhat. I therefore estimate that we will see multiples come close to their real values in the second half of next year and an increase in the number of deals," said Mihai Sfintescu, partner of 3TS Capital Partners.
A poll conducted among members of SEEPEA found that the main obstacles hindering the development of private equity investments on the local market are the reluctance of Romanian entrepreneurs to accept an investor and the low number of interesting companies on the domestic market.
"A lot of Romanian co
