The latest barometer of deal-doing sentiment in Central Europe shows continued growing confidence, with 84% of respondents feeling 2024 will prove a good year for returns as the Index climbed steadily for the fourth semester in a row.
The Index is typically linked to economic expectations, and the sentiment here is also encouraging: just a tenth now expect a decline in the backdrop, down from a fifth last time and 43% a year ago. Furthermore, a third (31%) expect conditions to get better.
Liquidity is more readily available now, with a third expecting debt availability to increase for the rest of this year. This may support larger deals: for the first time in a decade, the Survey reveals no expectations of falling deal sizes. It is also the fourth Survey in a row where fewer expect leverage availability to contract.
“We are greatly encouraged to see the Index surpassing its 20-year average after a period of prolonged uncertainty,
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says Jan Brabec, Deloitte Partner and Private Equity Leader.
“This recovery in sentiment is more gradual and sustained than those which followed the three other dips, suggests cautious optimism and reflecting experienced gleaned over a quarter century of navigating economic cycles and complex environments.
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ESG continues to play an important role for firms in the region, with over two-fifths (41%) starting to develop future commitments and targets towards climate neutrality and another fifth having already implemented formal decarbonization commitments and targets.
Private equity firms across the world increasingly incorporate sustainability and diversity metrics into their decision-making and value creation plans. Central Europe is no exception. With valuations clearly being impacted by success in this important area, we expect private equity to play a leading role in helping businesses in the region continuously progress with their ESG frameworks,
says Julia Patorska, Partner, Sustainability and Climate Portfolio Leader for Deloitte Central Europe.
For full Survey results, please click here.
Enduring Confidence | Deloitte Central Europe Private Equity Confidence Survey | Summer 2024
The Private Equity Confidence Survey has been tracking the changing sentiments of the Central European investment community every six months since 2003. Deloitte Central Europe proudly presents the latest report which marks the 43rd edition of the programme.
Source – Deloitte
