DENMARK Trends and Developments Contributed by: Morten Jensen, Elise Ross-Hansen, Frederik André Bork and Paula Grønlund, Bruun & Hjejle
While macroeconomic headwinds persist, the outlook for TMT transactions remains optimis - tic, underpinned by strong investor appetite, AI- driven growth and the sector’s adaptability to changing market conditions. Public-to-Private Transactions The Danish legal M&A market has seen increased interest in public-to-private transactions during 2024, and expects interest to continue in 2025. The Danish legal framework has been particu - larly accommodating to these transactions, with recent reforms aimed at reducing bureaucratic hurdles and expediting the approval processes. This has made Denmark an attractive destina - tion for private equity firms looking to execute public-to-private transactions. Growing Market for M&A Deals Within the Defence Industry The Danish defence industry has witnessed a surge in M&A activity, driven by several factors, including recent increases of defence budgets, geopolitical uncertainties and the need for tech - nological advancements. The Danish govern - ment has recently announced an acceleration fund of DKK50 billion (EUR6.7 billion) to fast- track the modernisation of the Danish armed forces. As Denmark strengthens its military capabilities and defence infrastructure, both domestic and international investors are seek - ing opportunities in this expanding sector. Private equity firms and venture capitalists have also entered the defence market, recognising its potential for high returns. This influx of capital is supporting the growth of innovative start-ups and mid-sized companies, making them attrac - tive acquisition targets for larger defence con - tractors looking to expand their technological capabilities.
Given the ongoing geopolitical landscape, defence-related M&A activity is expected to remain strong in 2025. Denmark’s commitment to NATO obligations and support for Ukraine has necessitated substantial investments in defence technology and infrastructure, further driving deal-making in the sector. Sector-Specific Consolidation Sector-specific consolidation is becoming a prominent trend, particularly in the financial and logistics sector. Denmark’s financial sector continues to expe - rience a wave of consolidation, as firms seek to enhance operational efficiency and expand market share. Similarly, the logistics industry is undergoing structural shifts due to supply chain disruptions and geopolitical developments, prompting companies to pursue strategic M&A to strengthen their competitive positioning. The Buy-and-Build Approach As mentioned, private equity firms are active players in the Danish M&A market. One of the most prevalent approaches used by these firms is the buy-and-build strategy, in which firms acquire smaller companies and integrate them into a larger, more competitive entity. Not only do such strategies enhance the market position of the acquired companies but they also create synergies that can lead to increased oper - ational efficiencies and market share. The buy- and-build model – which has been recognised and seen in previous years and is expected to continue in 2025 – is particularly appealing in sectors where consolidation can lead to signifi - cant competitive advantages, such as technol - ogy, healthcare and industrial manufacturing.
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