Publications
& Policy

As the current economic expansion chugged into its ninth full year in 2018, the global private equity (PE) industry continued to make deals, find exits and raise capital at a historic five-year pace. Limited partners (LPs) remain highly enthusiastic and have continued to flood the market with fresh capital. Keeping the momentum going, however, has hardly been easy. Chronically heavy competition has driven deal multiples to historic highs, and growing jitters about an eventual economic downturn are affecting decision making, from diligence to exit planning. For general partners (GPs), putting record amounts of capital to work means getting comfortable with a certain level of discomfort when investing. They are paying prices they swore they would never pay and looking to capture value that may prove elusive post-close. The most effective GPs are stepping up their game to identify targets and sharpen diligence, while simultaneously planning for the worst. In Sections 2 and 3, we’ll explore several strategies firms are using to make the most of an increasingly difficult market. In the meantime, here’s what happened in 2018.

In this paper, the PAE welcomes the opening of interinstitutional negotiations on the insolvency file and puts forward several suggestions including on the cross-class cram down, voting procedure for approval of restructuring plans, debt-discharge period for entrepreneurs and the stay on enforcement of actions.

In this response we stress the industry's support to the creation of a new category of long term equity exposures subject to a lower risk-weight, while explaining why the criteria proposed by the Commission to determine which investments fall into this category are inappropriate from our perspective.

In this response the PAE details the industry's concerns regarding the scope of the Key Information Document Regulation and the need to adapt it to sophisticated investors. It also highlights the irrelevance of existing performance scenarios for closed-ended and illiquid funds.

EIF: This European Small Business Finance Outlook (ESBFO) provides an overview of the main markets relevant to EIF (equity, guarantees, securitisation, microfinance)2. It is an update of the June 2018 ESBFO edition. We start by discussing the general market environment, then look at the main aspects of equity finance and guarantees/SME Securitisation (SMESec). Finally, before we conclude, we briefly highlight some important aspects of microfinance and Fintech in Europe.

The H1 2018 activity data report provides a semi-annual review of fundraising, investment and divestment trends for European private equity and venture capital activity. Please note that this data is preliminary and subject to change.

The findings of a survey of investors from the US, China, France, Germany and the UK. It outlines opinions on issues important to investors, such as capital markets strength, innovation and sustainability, and shows strong appetite for European investments.

While challenges remain in the UK economy, such as low productivity and continued political uncertainty, the UK’s private equity and venture capital industry has demonstrated its resilience by continuing to deliver substantial amounts of cash distributions to investors. Over the longer term, private equity continues to comfortably outperform public markets. The overall since-inception return has been steady, increasing to 14.5% in 2017 and demonstrating significant levels of stability in overall returns. Against a backdrop of political uncertainty in the UK and abroad, the industry continues to grow with all of the funds covered in the survey generating one-year IRRs of 38.5%. This compares favourably with the FTSE All-Share of 13.1% for the same period.

This study presents the second part of the results from the first EIF VC Survey, a survey among venture capital general partners (GPs)/management companies headquartered in the EU-28 and some additional countries (mainly Norway, Switzerland and Turkey). The surveyed population includes both companies in which the EIF has invested as well as companies in which the EIF has not (or not yet) invested.

"Investors can capture more value by focusing on three best practices in private equity portfolio company exits."

In this response we outline several concerns regarding the EBA suggested approach to define the concepts of “investments in private equity” or “investments in venture capital firms” in the context of Article 128 of the Capital Requirements Regulation, as the proposed definitions could create more confusion than clarity, disicentivise banks' investment into private equity and venture capital funds and create a negative precedent for the industry in other legislation.

An Invest Europe study into private equity activity in Central and Eastern Europe. This report provides annual private equity and venture capital fundraising, investment and divestment statistics for the private equity markets of the CEE region in 2017.

An in-depth study which outlines the tax environments for the private equity and venture capital industry around Europe, carried out in association with KPMG.

An introduction to the voluntary passport regime offered by the revised European Venture Capital Fund Regulation.

The Invest Europe Annual Report provides an overview of Invest Europe's activities during the 12 months to June 2018 in fields including public affairs, data & research, events and communications. The report includes a financial statement.