"These are interesting times,” says Natalia Drebezgina, Partner at Debevoise & Plimpton in Moscow, when asked for The Buzz in Russia.
When asked about the Buzz in Austria, Thomas Kulnigg, Partner at Schoenherr, says that M&A activity has significantly increased, with 2016 being one of the top 10 years in deal volume since 1988, and he says that 2017 is "well on its way." What Kulnigg is currently excited about, beside the typical Corporate/M&A work, is the start-up work his team is doing.
“You cannot really start with the legal industry before you understand the political moment in the country” says Vladimir Radonjic, the Managing Partner of Radonjic / Associates in Montenegro, when asked for the Buzz in his country. “Politics has been the main subject of conversation in the country for the last 12 months.”
Things are stable in Slovenia at the moment, according to ODI Law Managing Partner Uros Ilic. "The last few year were extremely busy because of the previously-distressed situation in Slovenia," he explains, "but now things are back to normal. On the M&A side you will not have as many large deals as in recent quarters, since the privatization work stream has completely dried up. A few deals in the pipeline, but nothing of a very big size. The sale of Cimos has finally been successfully concluded, the Gorenjska Banka sale and Cinkarna Celje are in process, and a few transactions are still in the pre-marketing stage It seems that we are also no longer the hot spot for NPL buyers, hedge funds and the like, as normal growth activities/business activities are back."
When asked what’s happening in Croatia, Dusko Zuric’s answer is simple: "Agrokor is happening.” Zuric, the Managing Partner of Croatia’s Zuric i Partneri, sighs at the extent of the liquidity fallout from the implosion of Agrokor’s landmark 2013 acquisition of Slovenia’s Mercator, which created one of the biggest food and retail businesses in Central and Eastern Europe, but also resulted in the accumulation of almost EUR 6 billion in debt, leading Agrokor’s president and 95% owner, Ivica Todoric, to seek protection from creditors and to hand control of the group to the emergency administration controlled by the Croatian state and court, all under a newly passed law — nicknamed Lex Agrokor — creating a form of pre-bankruptcy protection for systemic enterprises.
Business is good in Bulgaria at the moment, according to Ilko Stoyanov, Partner at Schoenherr in Sofia. He draws particular attention to the real estate market — especially the shopping mall segment, which has seen four Sofia malls change owners already this year. Stoyanov isn’t able to pinpoint a particular reason for the boom, but notes that two of the malls (The Mall and the Serdika Center) are expected to be sold to a "sizeable investor” — New Europe Property Investments. The price of real estate has increased in 2017, according to Stoyanov, “reaching levels close to before the financial crisis."
Gelu Maravela, the Co-Managing Partner of Maravela⎪Asociatii, waives away the potential impact of politics on investment in the country. “There’s no election scheduled for this year anyway,” he says, “so for the next six years we’re 'at bay' on major changes.” In any event, “in terms of politics, we don’t care about it. They have their own agenda. Obviously they have some influence on it, but they can’t really contribute to our business. The private sector moves by itself.”
Despite fighting his way through a spring cold, Peter Daszkowski, Co-Managing Partner of Wolf Theiss in Poland, is sanguine about the state of affairs in Poland. "With regard to Warsaw it’s business as usual,” he says.
“There is quite a lot going on, on both the political and economic sides” says Milan Samardzic, Partner at Samardzic Oreski and Grbovic law firm in Belgrade, although he concedes that, in the period leading up to the recent April 2 election (which resulted in the election of Prime Minister Aleksandar Vucic to President), much work has been put on hold. Indeed, Serbia has gone through two straight years of elections, Samardzic points out, causing the country a more extensive period of inactivity than might otherwise have been expected.
“The country is still in recession” says Sergei Makarchuk, Partner at CHSH in Belarus, pointing to an approximately 3% decrease in GDP recorded in Belarus in 2016. Bankruptcy in the corporate sector is on the increase, he reports, with the economic courts’ docket “overflowing” with such cases. The purchasing power in the economy has slowly decreased as a result of lower income and decreased spending power for the middle class.
“The Slovak economy is, surprisingly, experiencing good times,” says Tomas Rybar, Partner at Cechova & Partners in Bratislava, despite political turbulence due to lasting issues relating to corruption and some of the xenophobic and anti-immigrant attitudes that have arisen in the country in recent years – as they have across Europe – and the rise of the far-right.