Spotlight on Poland – open for business

Family offices are emerging as increasingly influential players in Poland. While these entities are relatively novel in the Polish context, their presence in M&A financing is growing.

Poland has experienced a significant increase in private wealth over the past three decades, leading to the professionalisation of wealth management among high-net worth individuals and business families. The legal introduction of the Polish family foundation in mid-2023 further facilitated this shift, offering a more structured vehicle for long-term capital deployment, succession planning and asset protection.

Family offices often have greater investment flexibility, longer time horizons and a higher risk tolerance than traditional institutional investors. In the current environment, characterised by higher interest rates, tighter bank lending and selective private equity (PE) activity, family capital is stepping in to fill gaps, particularly in mid-market transactions and succession-driven deals.

This segment is expected to grow rapidly as more business owners look to diversify and reinvest wealth, and as the ecosystem around family wealth management continues to mature. We are already seeing increased collaboration between family offices and PE funds, as well as direct investments into promising Polish SMEs.

We have also seen a wave of activity in the country’s financial services sector, with four of the seven biggest deals announced in H1 relating to assets in this area. The Polish financial sector has demonstrated remarkable resilience since the global financial crisis, and M&A in the industry has gone from strength to strength.

Higher interest rates have allowed Polish banks to generate substantial income from their lending activities, bolstering their financial performance. Moreover, the influx of people into Poland following 2022 has led to a housing market boom. This surge in demand has positively impacted banks, which have seen increased activity in mortgage lending and related services.

Polish banks have strategically focused on stable and predictable revenue streams. This approach has helped them maintain a steady financial performance and has contributed to the overall positive effects for M&A seen in the sector. By prioritising stability, banks have been able to navigate economic fluctuations more effectively.

Beyond the financial sector, we see a number of areas with strong potential for dealmaking going forward. For instance, Poland, which has historically relied on coal heating assets, is seeing a significant shift towards alternative energy sources. This transition is driven by both environmental concerns and the need for sustainable energy solutions. Investments in renewable energy, such as wind, solar, and biomass, are expected to increase, spurring M&A opportunities in this sector.

As in other parts of Europe, defence spending in Poland – already very high by regional standards – is also set to increase, driving the development of dual-purpose infrastructure that serves both civilian and military needs, such as transportation networks, communication systems and logistics hubs. This will create many opportunities for companies specialising in construction, engineering and technology integration. This sector is poised for consolidation and strategic partnerships.

Besides these emerging trends, Poland retains a strong industrial base, with a diverse range of manufacturing and production capabilities. The industrial sector is expected to see a wave of consolidation as companies seek to enhance efficiency, scale operations and expand their market reach. Digitalisation, too, is a priority. The integration of advanced technologies, such as automation, AI and the Internet of Things, will further boost the industrial sector’s growth. Companies that innovate and adopt these technologies will be well-positioned for success.

Poland’s reputation as a destination for international investment is also evolving – six of the 10 biggest M&A deals announced in the country in H1 featured cross-border bidders.

Poland has long been recognised as a standout destination for international investment in Central & Eastern Europe, often referred to as a “green island” due to its relative economic stability and consistent growth, even during periods of regional or global uncertainty. Since the collapse of the Soviet Union, Poland has experienced steady economic development, underpinned by a robust legal framework, a skilled workforce and a strategic location within the European Union. These factors have contributed to Poland’s reputation as a reliable and attractive market for foreign investors.

While US investment has played a significant role in Poland’s economic rise, most foreign direct investment has historically come from Western European countries, particularly Germany, France and the UK. Nevertheless, US investors remain active and influential, especially in sectors such as finance, technology and manufacturing.

Looking ahead, there are strong indications that US investment in Poland will continue to grow. Recent examples include notable transactions in the banking sector, such as the acquisition of two Polish banks by Cerberus, a US-based PE fund. These deals underscore the ongoing interest of US investors in Polish assets and the country’s openness to cross-border transactions.

Overall, the mood among Polish dealmakers remains upbeat. With financing conditions continuing to ease and a diverse group of sectors poised for consolidation, in addition to major tech-enabled growth, Poland remains a stable, attractive and willing hub for M&A.