European private equity fundraising hits eight-year high at €74.5 billion, investments and exits remain strong, 2016 Invest Europe data shows15 May 2017
Private equity fundraising for investment into companies across Europe hit its highest level since 2008 last year at €74.5 billion, a 37% year-on-year increase, according to new data released today by Invest Europe.
The association’s 2016 European Private Equity Activity report is the industry’smost comprehensive and authoritative source of activity data. The report reveals private equity investments totalled €53.7 billion last year, the second highest amount since 2008. Almost 6,000 companies across Europe benefited from investment, 83% of which were small and medium-sized enterprises (SMEs). Exit activity remained robust at €38.9 billion, divested at cost.
“This data demonstrates high investor confidence in European private equity, in an otherwise low-yield global investment environment,” said Michael Collins, Invest Europe’s Chief Executive. “All European economies are nowgrowing and investors value the proven ability of European fund managers to find attractive investment opportunities across sectors and geographies.”
In the last four years, European private equity funds have raised over €240 billion to invest into companies in Europe — more than twice the amount raised in the four years following the financial crisis, 2009 to 2012. Pension funds accounted for over a third of capital raised in 2016.
Consumer goods and services in Europe received the largest amount of private equity investment last year, at 28% of the total — a 23% year-on-year increase for the sector. The technology sector (communications, computing and electronics) received a fifth of the annual investment, as did business-to-business products and services.
France and Benelux-based companies received more than a third of private equity investments in 2016. Investments in Southern Europe were 19% of the total, mainly driven by increased investments in Italy and Spain. UK & Ireland and DACH-based companies each had about 17% share of the total investment, followed by the Nordics at 9% and CEE at 3%.
“Over 40% of capital raised by European private equity last year came from investors outside of Europe, while a third of investments made into companies were cross-border,” said Collins. “Connecting global investors with local fund managers and working with policymakers to facilitate suchcross-border flow of capital is an ongoing priority. This is animportant source of funding for thousands of European companies.”
The 2016 European Private Equity Activity report covers activity on over 1,200 firms, directly verified by the fund managers. Together with national private equity associations across the continent, Invest Europe has developed the most comprehensive database of European private equity statistics, which holds data from over 3,000 European private equity firms on 7,000 funds, 60,000 portfolio companies and 200,000 transactions since 2007.
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