Successful transaction closed: Targo Finance acted as exclusive financial advisor to the sellers of Sol Navitas in its successful sale to TSG Group, the European leader in technical services for responsible mobility solutions.

Targo Finance is proud to announce that it has acted as financial and transaction advisor to the sellers in the successful sale of 100% of the shares in Sol Navitas, a company specializing in the design, installation, and maintenance of solar power plants and energy storage systems.

We extend our congratulations to the acquirer, TSG Group, the European leader in technical services for responsible mobility solutions, and wish them continued success in the future. We would also like to sincerely thank the sellers for their trust, excellent cooperation and confidence in our team throughout the entire process. A special thank you goes to attorney Rok Jerovšek from the law firm Jerovšek Malis, who provided ongoing legal support to the sellers during the transaction.

At Targo Finance, the project was led by Marko Kašan together with his colleague Mateja Ahej, ensuring smooth execution and successful closing.

Once again, congratulations to both Sol Navitas and TSG Group on reaching this significant milestone.

The acquirer TSG Group:

TSG is the European leader in technical services for responsible mobility solutions. Over the past three years, the company has completed more than 40 acquisitions across 17 countries. Through these acquisitions, TSG continues to strengthen its capabilities in integrated electric infrastructure, with the ambition of becoming the reference provider for multi-energy solutions in Europe.

The acquired Sol Navitas:

Founded in 2008 in Celje, Slovenia, Sol Navitas has built more than 3.000 solar power plants in Slovenia, Croatia, Bosnia and Herzegovina, and Serbia, with a total capacity exceeding 60 megawatts. The company primarily serves commercial and industrial clients. In addition to photovoltaic systems, Sol Navitas also offers related solutions such as EV charging stations, battery storage, and solar carports.

One of the most crucial questions in any business sale is: “How much is my company worth?” While a professional valuation is essential to facilitate a well-grounded and economically sound agreement between seller and buyer, it is also insightful to examine market data on transactions in the region where the company operates. Comparable transactions provide valuable benchmarks that can help shape realistic price expectations during negotiations.

This article focuses on accessible and verifiable market transaction data, which can offer a reference point for achievable company sale prices also in Slovenia.

Of course, this approach involves considerable uncertainty and cannot replace a detailed valuation, as it does not account for the specific conditions under which individual transactions were completed—such as strategic acquisitions or related-party deals.

The analysis draws on data from Dealsuite, Mergermarket, Forvis Mazars, other relevant sources, and Targo Finance’s advisory experience in company sales and acquisitions.

What Is the EBITDA Multiple?

The EBITDA multiple represents the ratio between a company’s enterprise value (EV) and its earnings before interest, taxes, depreciation, and amortisation (EBITDA). It is a key metric that enables investors to quickly compare business valuations within the same sector.

In Central and Eastern Europe (CEE), these multiples vary based on country, company size, technological and digital maturity, and market positioning.

Average EBITDA Multiples in the CEE Region: Between 5.2x and 6.7x

The years 2024 and 2025 have brought a new dynamic shaped by macroeconomic factors, sector-specific preferences, and growing interest from strategic buyers, as well as increased capital availability in private equity (PE) funds.

In the first half of last year, the average EBITDA multiple for small and medium-sized enterprises (SMEs) in the CEE region was 5.2x. According to Mergermarket, the median EV/EBITDA multiple across all sectors in the CEE in 2023/24 stood at 6.7x—still lower than the Western European average of 9.4x.

The gap between CEE and Western Europe is narrowing, indicating growing investor confidence in the region. Historically, lower multiples in CEE were influenced by factors such as smaller deal sizes, lower buyer competition, and a more fragmented market.

Key Factors Influencing Company Valuations and Sale Prices in the CEE Region:

• Macroeconomic uncertainty: High interest rates and inflation increase the cost of capital, putting downward pressure on multiples. However, regional stability—especially following the shift away from dependence on Russian energy—boosts investor confidence.
• Sectoral trends: Technology and digital sectors, including renewable energy (e.g., solar power), are achieving high multiples of 10–14x EBITDA (Dealsuite). Traditional sectors, such as construction, remain at 4–6x.
• Company size: Smaller companies (with EBITDA under EUR 5 million) tend to attract lower multiples (4–7x) due to customer concentration and market exposure risks. Medium to large deals (EBITDA over EUR 15 million) can command 8–12x.

Sector Overview: Highest Multiples in Healthcare and IT

EBITDA multiples vary significantly across industries. In the first half of last year, the healthcare and pharmaceutical sector recorded the highest average multiple in the CEE at 7.1x, followed by software at 6.8x. Hospitality and tourism, by contrast, posted the lowest multiple at just 3.9x.

Interestingly, software companies are even more highly valued in Western Europe, with average multiples of 8.5x in the DACH region (Germany, Austria, Switzerland) and 7.0x in the Netherlands.

Country Comparison in Central and Eastern Europe

In the past year, Poland, Austria, and Romania led the CEE region in terms of M&A transaction volume. Together, they accounted for the majority of the region’s activity, with the technology sector attracting the most foreign investor interest.

Although EBITDA multiples in CEE are still lower than in Western Europe, the gap is narrowing. Previously, larger discrepancies were driven by political and economic risks and higher discount rates in the region. However, as economic conditions improve and investor trust grows, these differences are gradually diminishing.

• Poland is the region’s largest market, with multiples ranging from 7–10x. Its strong presence in high value-added sectors (e.g., automotive, IT) attracts Western strategic buyers.
• Czech Republic boasts high productivity and political stability, with multiples around 8–11x, especially in automotive and financial services.
• Romania and Hungary are fast-growing markets with average multiples between 6–9x. However, weaker corporate governance still weighs on valuations.
• The Balkans, particularly Croatia and Serbia, are seeing increased deal activity, especially in tourism and logistics, with multiples ranging from 5–7x.

What About Slovenia?

Unfortunately, comprehensive and verified transaction data for Slovenia is scarce. Private buyers and sellers typically do not disclose deal details, and the limited market size makes it difficult to establish reliable benchmarks.

Nevertheless, as Slovenia is part of the CEE region, we can draw upon regional data and our own experience at Targo Finance, where we advise on both buy- and sell-side transactions.

According to recent reports (e.g., Dealsuite and Forvis Mazars), average EBITDA multiples for SMEs in the region hover between 5.2x and 5.5x. This means that companies are typically sold for approximately five times their annual EBITDA.

Higher multiples are seen in high value-added industries, such as:

• Healthcare and pharmaceuticals (approx. 7x)
• Information Technology (approx. 6.8x)
• Industrial manufacturing (approx. 5.5x)

Lower multiples are common in:

• Hospitality and tourism (approx. 3.9x)
• Retail (approx. 4.2x)

These trends generally apply to Slovenia as well. However, given the market’s small size and unique characteristics, greater volatility in multiples can be expected. In recent years, investor interest in Slovenia has remained stable—particularly in sectors offering specialized expertise, advanced technology, or well-positioned products.

Conclusion: Positive Outlook for the Future

Despite challenges such as high interest rates and geopolitical uncertainty, the M&A market in the CEE remains active. EBITDA multiples have stabilized, and high value-added sectors like healthcare and IT continue to achieve strong valuations.

For businesses in the region, this presents a strategic opportunity to consider sales or mergers, particularly in high-demand industries. Investors, meanwhile, can still benefit from competitive valuations and strong growth potential in the CEE market.

Mateja Ahej, Targo finance d.o.o.

Entrepreneurs and business owners often wonder about the value of their company. These questions typically arise in various situations, such as preparing for a sale, attracting new investors, or simply gaining a deeper understanding of their operations and the assets tied to the business. Ultimately, the value of a company is not just a number – it reflects the company’s story, its performance, potential, and risks. Understanding which factors most influence this value is essential for strategic decision-making by the business owner.

A frequent part of my conversations with entrepreneurs and business owners revolves around the factors influencing company value. I recall a conversation with Mr. Janez, who introduced me to his manufacturing company that he had founded several decades ago. He enthusiastically described his business and proudly spoke about his employees and their expertise, developed over years of operation and enhanced through numerous training programs. In his view, this was invaluable.

I explained to him that while these "intangible" elements are indeed important, company value is determined by much more. Measurable factors – such as financial performance, financial position, the organization of processes, and strategic advantages – carry significant weight. Unfortunately, in some of these areas, Mr. Janez's company was lacking. Precisely because of these diverse influences, we at Targo Finance developed a framework for assessing the value drivers of a business. This indicative review does not provide a direct valuation but serves as a diagnostic tool to identify the strengths and weaknesses of a company.

Key Drivers of Business Value

When determining the value of a business, a variety of both quantitative and qualitative factors must be considered. Some of the key drivers include:

Financial Performance and Position

• Revenue, Profitability, and Cash Flows: Companies with high and stable revenues, strong profits, and positive cash flows typically have higher value.
• Liquidity and Capital Adequacy: A healthy financial position reduces risk for investors.
• Debt Levels and Working Capital: Low debt provides greater flexibility and lowers risk. Appropriate levels of working capital are also crucial.

Company Size and Market Position

• Larger companies often have higher valuations due to economies of scale, stronger brand recognition, and lower risk of failure.
• Market share and competitive advantage significantly influence perceived value.

Sales-Specific Characteristics

• Customer Diversification: Companies that are not overly reliant on a few customers are more attractive to investors.
• Contract Length: Clearly defined and long-term contracts provide revenue stability.

Organizational Structure and Process Maturity

• Efficient operations and a well-organized structure increase operational performance.
• Clear organizational structure and documentation simplify knowledge transfer and management.

Employee Knowledge and Competence

• Companies with highly skilled employees enjoy a competitive edge.
• It’s crucial that this knowledge is embedded within the organization and transferable.

Business Dependencies

• Key Person Dependency: Companies that rely heavily on a few individuals pose greater risk.
• Supplier Dependency: High reliance on a limited number of suppliers can reduce business value.

Other Important Variables

• Regulatory Environment and Compliance: Compliance with legal requirements reduces legal and reputational risks.
• Market Outlook: Industry or regional growth potential enhances company attractiveness.

Indicative Review as a Tool for Improvement

Our approach is based on a model that gives entrepreneurs and business owners insight into their performance across various areas. The analysis yields an overall weighted score that shows how the company compares to its industry peers. This score is not a direct valuation but serves as a basis for discussion and improvement planning.

Review Process:

1. Data Collection: A detailed analysis of financial indicators, organizational processes, and market positioning. This includes interviews and discussions with company management.
2. Financial Benchmarking: We assess how the company compares to others in the same industry.
3. Identification of Strengths and Weaknesses: We identify areas of strong performance and those requiring improvement.

Conclusion

Understanding the factors that influence company value is crucial for effective management and strategic decision-making. Whether preparing for a sale, seeking investors, or focusing on internal improvements, a comprehensive business review is the first step. By focusing on financial metrics, organizational structure, and market positioning, entrepreneurs and business owners can enhance their company’s value and ensure long-term success.

Author: Marko Kašan, Targo finance d.o.o.