M&A revival in Hungary, value more than doubles: HVCA 20th Annual Investment Conference
Christian Majgaard, ex head of Global Brand & Business Development at LEGO, delivers keynote
June 12, 2018 – The Hungarian Private Equity and Venture Capital Association (HVCA)’s 20th Annual Investment Conference on private equity, venture capital and corporate finance in Central and Eastern Europe (CEE) was held today in Budapest. Christian Majgaard, branding and innovation guru, and former head of Global Brand & Business Development at LEGO, was keynote speaker in the 20th anniversary event. The HVCA’s annual conference brings together the key CEE/SEE decision-makers, investors, advisors, and regulators in PE, VC and corporate finance – and this year addressed themes such as innovation and brand development, fintech opportunities, strategic exits, impact investing, and the transformation of major local brands such as Hungary’s Tungsram.
“Change of owners often implies change of corporate strategy. Since brand strategy shouldn’t exist in isolation, new owners equals new brand strategy,” said Mr Majgaard. “Reviving a brand is like healthcare: the right treatment depends on the diagnosis. There is no ‘one cure for all’.”
“The increase in value and volume for M&A transactions in Hungary during 2017 shows that our market is still attracting considerable interest and supporting strong momentum. We expect this trend to continue or even strengthen through the rest of the year, especially for domestic players,” said Levente Zsembery, HVCA Chairman and CEO of X-Ventures. “These are auspicious findings for the 20th year of our Conference, and for the HVCA and our investor community.”
M&A in Hungary has been reviving in 2017, with number of transactions up from 110 in 2016 to 133, and the value of the Hungarian M&A market up from $1.6bn in 2016 to $4bn in 20171. According to the same figures, Hungary also had the highest proportion of domestic transactions in its total M&A activity for 2017, with 63% of deals being purely domestic, yet Hungary also saw one of the region’s highest proportion of financial investors, tieing with Slovenia at 36% of all M&A transactions.
During the Conference, the MFB formally announced the signature with the EIF of its membership of the Central Europe Fund of Funds (CEFoF) international investment fund. The aim of CEFoF is to provide equity funding for small and medium-sized enterprises and small mid-cap companies operating in Central Europe through funds active in the region. Another highlight of the Conference was Joerg Bauer, President and CEO of Tungsram Group, talking about the MBO and revival of this classic Hungarian brand.
“It is clear that we have only seen the beginning of the FinTech revolution, as we expect a complete transformation of the financial services sector,” added Zoltán Lengyel, Partner at Allen & Overy, a key supporter of the Conference. “So don’t be surprised when your children will ask for their pocket money in cryptocurrency!”
1 EY M&A Barometer 2017
About the Hungarian Venture Capital and Private Equity Association (HVCA)
The Hungarian Venture Capital and Private Equity Association (HVCA) represents the interests of the private equity and venture capital industry in Hungary by supporting its members and promoting adherence to the highest possible professional and ethical standards. The HVCA was established in 1991. Currently, the HVCA is known as one of the most dynamic and active professional organisations in the CEE region. The HVCA represents virtually every major player of the private equity and venture capital industry in Hungary and is dedicated to promoting the private equity and venture capital industry for the benefit of funds, entrepreneurs, private equity professionals and the economy as a whole.