Real Deals Q&A with Matthew Strassberg: Why a Local Presence is Key
What encouraging trends were seen in 2024 in Central Europe (CE)?
First of all, the CE region continues to outperform core Europe on macro; with forecasted growth for the region expected to be between 2.5-4% in 2025, according to EY. This is primarily driven by consumption, buoyed by strong nominal wage growth, as well as the benefits of EU funding and foreign direct investment flows.
The region continues to attract major foreign investment, as global technology players embrace the well-educated and highly productive workforce. Google’s €1.8bn investment in cloud technology and data centres in Poland, as well as Intel’s planned €4.6bn semiconductor assembly plant, highlight the increasing attractiveness of the region for large-scale investment projects.
In addition, a number of CE countries, including Croatia, have been upgraded to investment grade by the ratings agencies; underscoring the region’s improving financial metrics and stability, bolstered by decelerating inflation and unemployment rates consistently well below the EU average of 6.3%. This has also been reflected in a recovery of the regional stock market and the reopening of the local IPO market.
What were MidEuropa’s highlights in the past year?
2024 was a landmark year, as we celebrated the firm’s 25th anniversary. We have had a very productive 12 months. Since the start of 2024, we have made commitments on behalf of our Fund V and co-investors that total more than €200m and have returned circa €1.1bn.
In terms of new commitments, most notable is our investment in Famar – a leading European pharma CDMO business – where we plan to leverage our extensive healthcare sector experience.
We were pleased to announce several exits, including the just-closed divestment of Profi, the leading proximity supermarket chain in Romania, to Ahold Delhaize. This was the largest grocery deal ever in CE involving private equity and the largest PE-backed exit in Romania.
More recently, we have bucked the trend of a sluggish IPO market for PE exits. In February 2025, we successfully raised €400m in gross proceeds through an IPO on the Warsaw Stock Exchange for Diagnostyka, a leading provider of medical diagnostic services in Poland. With a market capitalisation of above €1bn on the day of the IPO, the company ranks as the second-largest publicly listed healthcare services provider in CE and is among the seven largest listed sector players in Europe.
We also continued to invest in our senior bench, with three partner promotions: Pawel Malicki, Marek Rodak and Filip Kisdobranski. All three have been with the firm for a number of years and have built strong track records, as well as internal and external credibility.
How did you continue to create value in your portfolio in 2024?
MidEuropa has a well-established playbook for adding value to our portfolio companies. Our investment and operating teams closely collaborate with management teams to implement a value creation strategy and deliver sustainable growth.
The success of our model is evidenced by double-digit average revenue and Ebitda growth across our portfolio in 2024. We supported our portfolio companies as they completed 15 bolt- on acquisitions, enabling entry into new markets, as well as giving them exposure to synergies and high-growth opportunities within their existing footprints.
An example of this growth strategy is Optegra, a leading European ophthalmology platform which operates in Poland, Czechia, Slovakia, and the UK. In 2024, the company closed four acquisitions in Slovakia, becoming a market leader in the country less than 18 months since entry. As a result of these transactions, as well as other investments, Optegra now serves patients through a network of 43 state-of-the-art clinics and performs more than 170,000 surgical procedures per year.
In addition to M&A, MidEuropa continues to drive value creation initiatives through digital transformation. Optegra, for instance, has implemented an AI-driven virtual patient assistant, improving patient experiences while simultaneously allowing the company to process a week’s worth of pre-operative assessments within a day.
How does your local network provide you with a competitive advantage?
As an investor with a 25-year track record in the region, one of our key strengths has been our ability to combine a pan-European perspective and network with strong local presence and credibility. This has been earned through decades of working on highly visible and successful investments.
We find that in today’s highly competitive dealmaking environment, where information is increasingly accessible, it is our relationships and people on the ground that provide us with a competitive edge. Our team’s expertise provides us with the level of conviction, confidence and agility we need to invest successfully in the region.
Our pan-regional approach – with professionals on the ground in Warsaw, Bucharest, Prague, and Zagreb – facilitates access to local founders and management teams, as well as a network of leading advisors with whom we maintain longstanding partnerships. These partnerships are critical to our ability to provide domain-specific and tailored solutions; seizing the best opportunities and addressing any operating challenges faced by our portfolio companies.