SLOVENIA Trends and Developments Contributed by: Bojan Šporar and Jože Stare, Rojs, Peljhan, Prelesnik & partners
Potential Distressed Transactions In parallel with increased deal activity, the Slovenian market is also witnessing early signs of restructuring processes in certain industries, which may give rise to distressed transactions in the near to medium term. Several industrial groups have faced operational and financial pressures in recent years, driven by energy price volatility, weaker demand in key export mar - kets and structural challenges in capital-intensive industries. Companies such as Unior, TPV Group and SIJ Group operate in sectors exposed to high input costs, cyclical demand and intense global competi - tion. These pressures have, in some cases, resulted in declining profitability, increased leverage and the need for operational and financial restructuring. While not all such companies are in formal distress, their situations illustrate the potential for restructuring- led transactions. These may include divestments of non-core assets, entry of strategic or financial inves - tors, recapitalisations or broader corporate reor - ganisations. In certain cases, debt restructuring or debt-to-equity conversions may also be required to stabilise balance sheets. Such situations typically create opportunities for dis - tressed M&A transactions, corporate restructurings and entry points for private equity and special situ - ations investors. Investors with experience in turna - round scenarios may find attractive opportunities to acquire quality assets at discounted valuations, pro - vided they are able to manage the associated opera - tional and financial risks. It is expected that lenders and shareholders will increasingly favour structured solutions, including partial disposals and strategic investor entry, rather than outright insolvency proceedings. This approach is consistent with broader European trends, where early intervention and consensual restructuring are preferred over formal insolvency. As a result, restructuring-driven transactions are likely to form an increasingly important component of Slo - venia’s M&A landscape, adding both complexity and opportunity to the market.
allow buyers and sellers to bridge valuation gaps but also introduce additional complexity into transaction documentation and post-closing integration. Defence-Oriented Opportunities A notable emerging theme in Slovenia’s investment landscape is the increasing strategic focus on the defence and security sector, reflecting broader Euro - pean geopolitical developments and commitments to higher defence spending. In 2025, Slovenian Sovereign Holding (SDH) estab - lished DOVOS as a dedicated investment vehicle focused on strengthening national defence, security and resilience capabilities. The entity is designed to take minority ownership stakes in domestic compa - nies and support the development of strategic indus - trial capacities. DOVOS is expected to play an active role in invest - ing in Slovenian defence and dual-use technology companies, supporting high-tech segments such as robotics, autonomous systems and advanced manu - facturing, and developing strategic supply chains and maintenance capabilities for defence infrastruc - ture. This initiative reflects a broader European trend towards strengthening domestic industrial bases in strategically important sectors. This development signals a shift towards a more inter - ventionist industrial policy, where the state acts not only as a regulator but also as an investor. From an M&A perspective, this may result in increased minor - ity stake investments by the state in strategic com - panies, co-investment structures alongside private investors and enhanced deal activity in sectors linked to defence, cybersecurity and critical infrastructure. For investors, this creates both opportunities and additional considerations. While the defence sector may benefit from strong public support and fund - ing, transactions may also be subject to heightened regulatory scrutiny, particularly under foreign direct investment screening regimes. The interplay between investment incentives and regulatory oversight is likely to be a defining feature of this segment.
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