Aug 2, 2018   SOURCE: PR NewsWire

European Private Equity Dealmaking Picks up Momentum in 2Q 2018, Driven by Regions Outside of UK and Ireland

SEATTLE, Aug. 2, 2018 /PRNewswire/ -- PitchBook, the premier data provider for the private and public equity markets, today released its 2Q 2018 European PE Breakdown Report, which found investment activity remained healthy in the first half of the year and capital invested is expected to reach the lofty levels achieved in 2015 and 2017, the highest performing years since the global financial crisis. Several large deals closed including Blackstone's EUR2.1 billion buyout of Cirsa Gaming and PAI Partners' EUR3.3 billion LBO of Refresco Group. Exits in the UK and Ireland increased as a percentage of overall exit activity--which slowed across regions--as dealmakers may be anticipating the impact of Brexit. Despite the slowdown in exits, Europe's PE Fundraising in 2018 is likely to end on a high note, potentially eclipsing the record setting figure of EUR79 billion achieved in 2017.

"We may be seeing the first signs of Brexit's impact on Europe's PE ecosystem," said Wylie Fernyhough, analyst at PitchBook. "Data suggests that dealmakers in the UK and Ireland are taking a more cautious, wait-and-see approach. Despite these potential warning signs, PE activity is still healthy on a historical basis."

Investment Activity 

    --  Following a lackluster first quarter, private equity deal flow increased
        in the second quarter with 804 European PE deals totaling EUR88.5
        billion - a 19% and 20% increase over 1Q values, respectively. If this
        pace of investment continues, 2018 will be primed for another strong
        year.
    --  Deal sizes also continued to swell. In the first half of 2018, 6.6% of
        all PE buyouts were over EUR500 million - up from 3.7% in 2013. Of total
        capital deployed, deals over EUR500 million increased from 40% in 2013
        to 60% in 2018.
    --  While the United Kingdom and Ireland continued to be strongholds for the
        PE industry, the France & Benelux (Belgium, Netherlands and Luxemburg)
        region achieved its highest percentage of deal value since 2010, at 29%.
        The uptick in activity is a signal of a maturing PE market across
        Europe.

Exits tepid

    --  Exit activity remained slow in the second quarter with 219 exits
        totaling EUR27.7 billion, bringing the first half exit value total to
        EUR53.6 billion, significantly less than the same timeframe last year at
        EUR88.4 billion.
    --  On a relative basis, exit activity in the UK and Ireland hit the highest
        levels in a decade. The region accounted for 31% of all exits in 1H
        2018, compared to 27% during the full-year 2017.
    --  Secondary buyouts (SBO) made up 51% of exits, the highest proportion on
        record. Additionally, SBOs in Europe trended larger than corporate
        acquisitions for the first time. The European PE industry saw 12 SBOs
        over EUR1 billion in the first half of 2018, compared to 17 in all of
        2017 and eight in 2016.

Fundraising 

    --  On the heels of a record 1Q 2018, PE fundraising slowed in the second
        quarter with 20 funds raising a combined EUR13.1 billion. The slowdown
        was to be expected given the accelerated pace of fundraising at the
        start of 2018.
    --  Funds above EUR500 million accounted for 50% of capital raised through
        1H 2018, up nearly five times from 11% recorded by this group in 2014.
    --  The Nordic region made up for the slower pace of fundraising in the UK
        and Ireland. Extending the active fundraising ecosystem, EQT held a
        final close on its EUR10.8 billion EQT VIII buyout fund in the first
        quarter and Nordic Capital held a final close on its EUR4.3 billion
        Nordic Capital Fund IX in the second quarter.

Additional coverage in this report includes:

    --  Key takeaways
    --  Overview
    --  Regional Spotlight: France & Benelux
    --  Exits
    --  Fundraising

Download the full report here.

About PitchBook
PitchBook is a financial data and software company that provides transparency into the capital markets to help professionals discover and execute opportunities with confidence and efficiency. PitchBook collects and analyzes detailed data on the entire venture capital, private equity and M&A landscape--including public and private companies, investors, funds, investments, exits and people. The company's data and analysis are available through the PitchBook Platform, industry news and in-depth reports. Founded in 2007, PitchBook has offices in Seattle, San Francisco, New York and London and serves more than 18,000 professionals around the world. In 2016, Morningstar acquired PitchBook, which now operates as an independent subsidiary.

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SOURCE PitchBook