DENMARK Law and Practice Contributed by: Simon Milthers, Thomas Bøgedal Kristiansen, Mikkel Friis Rossa and Emil Steenberg, Bech-Bruun
1. Market Trends 1.1 Technology M&A Market
Private equity and venture capital funds as well as family offices are actively acquiring compa- nies and providing growth capital in the Dan- ish tech M&A market. This trend is expected to continue with high-growth opportunities. The rise in cybersecurity importance has increased M&A activity involving cybersecurity assets, and the ongoing AI revolution is also driving activity. Valuation multiples for tech companies remain high, driven by demand for innovative solutions in fintech, healthtech, and software as a service (SaaS). Warranty & Indemnity (W&I) insurance still plays a crucial role in M&A transactions, providing par- ties with greater security and protection. ESG factors have become central to M&A, as inves- tors increasingly focus on sustainability and responsible business practices. 2. Establishing a New Company, Early-Stage Financing and Venture Capital Financing of a New Technology Company 2.1 Establishing a New Company When Danish founders decide to incorporate their business, they commonly choose a Dan- ish limited liability company. This incorporation process is quick and electronic, often finalised within 24 hours once the formation documents have been prepared. There are two types of limited liability compa- nies: • a public limited liability company ( aktieselsk- ab , or “A/S”), which requires a minimum capi- tal of DKK400,000 (approximately EUR5,370); and
During the past year, the technology M&A mar- ket in Denmark has remained relatively active compared to other sectors. Despite a general slowdown in the M&A market, transactions have continued to show significant interest in areas where Denmark has a strong reputation, such as technology, pharmaceuticals and healthcare, and renewable energy. This indicates that the activity in Denmark is somewhat aligned with the global pace, maintaining a steady volume of transactions. Expectations for 2025 are high, with many transactions in the pipelines across sectors. 1.2 Key Trends During the past year, M&A activity has surged, especially among Danish tech start-ups. Larger tech companies and private equity firms are increasingly acquiring innovative start-ups in fintech, healthtech, and green technology. Den- mark’s commitment to sustainability has driven a rise in M&A deals involving green technology and sustainable solutions, such as renewable energy, energy efficiency, and sustainable manu- facturing. The pandemic has accelerated the need for digital solutions, boosting M&A activity in digital transformation and software solutions. Cross- border transactions have increased, with foreign investors attracted to Denmark’s innovative tech ecosystem. Additionally, consolidation in the IT services sector is evident as companies expand their offerings and reach through M&A. The EU’s new regulations on AI and cybersecurity compel companies to adapt to new requirements and enhance their technological capabilities.
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