Hungary

In 2009, there were approximately 70 mid-size and large size deals in Hungary, with a drop of over 30% comparing to pre-crises period. This decrease has not been a surprise, given the fact that over 60% of pre-crises transactions were executed with acquirers being foreign investors, which, as a result of the downturn, became increasingly focused on their domestic markets.

Some of the sectors that saw significant M&A activity in 2009 were media, telecommunications, food and beverage and manufacturing sector. Apart from food and beverage sector, all other sectors saw significant drop comparing to pre-crises period.

With improvement in spending and country's ratings, Hungary is expected to improve its position in the European community, drawing larger interest of the investors. It is expected that number of deals in the year of 2011 will increase to the pre-crises period with simultaneous improvement in the number and size of deals occurring in other countries of Central and Eastern Europe.

Serbia

Though it is behind countries of the European Union in terms of annual transactions volume and size, the Republic of Serbia is increasingly becoming a favorite destination for cross-border investments due to low corporate taxes, low labor costs, favorable ratings and investment incentives.

Having an enterprise based in the Republic of Serbia offers unique trade benefits and customs regimes with the countries of European Union and Russia. Its free trade agreement with Russia allows for manufactured or value added goods to enjoy customs-free regime on the Russian market, while its favorable customs regime with Croatia, Bosnia and Herzegovina and Macedonia allows for goods manufactured in Serbia to enjoy strategic advantage on the markets of former Yugoslavia.

In 2009, Serbia's M&A activity has intensified in comparison with previous years with transactions taking place in various sectors such as food and beverage, manufacturing, banking, energy and services sectors. In spite of downturn considerably affecting sectors such as transportation and freight forwarding services for example, such sectors have also seen considerable M&A activity in 2009.

Croatia

In recent years, the Republic of Croatia has made considerable steps in attracting cross-border investments through both incentives offered to foreign investors and infrastructural development.

The country's stable macroeconomic climate, low tax rates and low labor costs are driving the M&A transactions volumes at numbers of a smaller European Union country.

The Republic of Croatia offers special incentives to manufacturers and companies in technology and services sector. Incentives are also offered through customs, employment and workforce education.

In 2009, Croatia saw considerable M&A activity, with transactions taking place across industry with focus on energy, food and beverage and retail sector.