Private deals gain traction
APPETITE for private equity backed deals increased during the second quarter, with a 38 per cent increase in the value of deals compared to the first quarter.
According to the Candover Unquote Private Equity Barometer, published yesterday, the number of European private equity transactions rose to €4.8bn (£4.1bn) in the period, compared to €3.5bn in the first quarter. Deal volumes remained similar, up seven per cent at 230.
“The most important reason for the pick-up in activity has been a sharp rise in the number of stressed or distressed opportunities coming to market,” the survey said.
The biggest acquisition in the period was Charterhouse Capital’s purchase of Wood Mackenzie Consultants from Candover for about €637m including debt.
But the value of investments was still down 85 per cent on the first six months of 2008, and volumes are down 42 per cent.
Total buyout value of €6bn in the six-month period was down 87 per cent year-on-year, with volumes down 70 per cent at 56 deals.
“While it is encouraging to see some growth in volumes and values compared to the first quarter, the market for buyouts remains extremely tough,” said Candover Partners’ chairman Marek Gumienny.
“However, transactions are not impossible. The sale of Wood Mackenzie shows that buyouts are achievable for high quality assets with strong management teams and good growth prospects.”