Central and Eastern Europe: a prime opportunity for LPs as growth rebounds

Private equity has transformed Europe over the past four decades, growing from €5 billion in assets under management in 1983 to over €1.15 trillion in 2023. It now supports 11.2 million jobs and drives innovation and long-term value creation. Within this, Central and Eastern Europe (CEE) is emerging as a region of renewed dynamism, one that limited partners (LPs) should not overlook.

After a difficult 2023, CEE private equity activity rebounded in 2024. According to Invest Europe’s latest Central & Eastern Europe Private Equity Statistics, investments rose 50% to €2.83 billion, back in line with the five-year average. Buyout activity increased 79% to almost €2 billion. Exits were up 33% to €1.35 billion, driven by IPOs. Fundraising also recovered, up 66% to €1.42 billion, with venture capital fundraising tripling to €657 million. Notably, capital from European LPs outside the region grew 58%, signalling a renewed appetite for CEE exposure.

Why CEE deserve LPs’ attention

1. Room to grow

Private equity investment in CEE equalled just 0.112% of GDP in 2024, roughly one-fifth the European average, highlighting untapped potential. As regional economies converge with Western Europe, the scope for private equity to add value is significant.

2. Proven track record in value creation

In 2024 alone, IPOs accounted for 44% of exit value, demonstrating the region’s ability to deliver liquidity and returns. The region has also generated major IPOs such as Allegro and Zabka. Overall, in 2024, CEE delivered its strongest exit performance since 2020, with divestments up 33% year-on-year.

3. Strong local talent and institutional capacity

CEE continues to be a promising market, offering skilled talent, experienced managers with strong governance and local networks, resilient entrepreneurs, and a range of diverse investment strategies. Mid-market succession and consolidation opportunities also remain particularly attractive.

A strategic window for LPs

CEE offers diversification, attractive risk-adjusted returns and access to fast-developing EU economies. With relatively low PE penetration and maturing ecosystems, LPs entering now can secure a strategic foothold and help shape the market’s next phase.

At the European Bank for Reconstruction and Development (EBRD), we have invested over €3.7 billion in more than 140 private equity funds in CEE, backing over 1,100 portfolio companies. We remain committed to the region and confident in its ability to deliver both returns and impact.

Europe, and CEE in particular, remains a high-potential region where private equity can drive real value. For LPs with vision, it’s time to take a closer look.

Anne Fossemalle
Director, Equity Funds, European Bank for Reconstruction and Development (EBRD)
Member, LP Council, Invest Europe