European private equity investment increased 14% to €47.4bn, fundraising and exits remain high, 2015 Invest Europe data shows10 May 2016
• Investments into almost 5,000 European companies, 86% SMEs
• Divestments remain high at €40.5bn with almost 2,500 companies exited
• Fundraising stays steady at €47.6bn in 2015
Private equity investment into European companies increased by 14% to €47.4 billion in 2015, along with high fundraising and exit activity, in another strong year for European private equity, according to new data released today by Invest Europe.
The figures come from Invest Europe’s 2015 European Private Equity Activity report; the most comprehensive and authoritative source of private equity fundraising, investment and divestment data for the European industry. The trade association’s report provides verified data gathered directly from more than 1,200 European private equity firms, covering 91% of the €564 billion in capital under management in Europe.
Almost 5,000 companies across Europe benefited from private equity and venture capital investment last year. Of these, 86% were small and medium-sized enterprises (SMEs) and nearly half of the total attracted private equity funding for the first time.
Venture capital investment increased by 5% at €3.8 billion, while buyout investment grew 16% to €36.3 billion. Growth investments reported an increase of 11% to €6.5 billion, reaching their highest level since 2008.
“Despite volatile financial markets and macroeconomic challenges, private equity and venture capital continue to be a solid source of investment capital for growing European companies,” said Invest Europe’s Chief Executive Dörte Höppner.
Strong momentum in European private equity fundraising continued, reaching €47.6 billion last year – narrowly below 2014’s €48.0 billion raised. Venture capital fundraising increased by 8% to €5.3 billion - the highest level since 2008. The €150 billion total raised by European private equity and venture capital in the last three years was 70% higher than the period between 2010 and 2012.
“Last year’s robust fundraising builds on the €150 billion total raised since 2013, reflecting institutional investors’ confidence in the asset class and the European market,” said Höppner. “Over 40% of funding came from investors outside Europe.”
2015 marked another healthy exit year for European private equity. Almost 2,500 European companies were exited, representing former equity investments of €40 billion, measured as divestment at cost. This amount matches 2014’s record breaking exit volume reported for European private equity.
As in 2014, 50 private equity-backed companies were exited by flotation on public markets in 2015*. Exits from already listed companies, in the form of sale of quoted equity, increased by almost 80% to €6.7bn (amount at cost). The most prominent exit routes by amount were trade sale at 29%, sale to another private equity firm (27%) and sale of quoted equity or on flotation (IPO) at 17%.
“Our 2015 European Private Equity Activity report is both rigorously compiled and non-commercial, meaning it’s a crucial annual gauge on the state of the industry,” said Höppner. “The data indicates another year of strong exits and return prospects for investors in private equity and venture capital, much of which will be reinvested into the asset class.”
Since the global financial crisis, European private equity and venture capital has invested almost €400 billion of capital in up to 28,000 European companies.
Formerly called the European Private Equity and Venture Capital Association (EVCA), Invest Europe is the non-profit trade association representing European private equity, venture capital and infrastructure funds and their global investors. The full report is free to download from here.
*Invest Europe data records IPOs of portfolio companies when they are registered as an exit by the private equity sponsor.
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