Against a backdrop of slowing global economic growth the number of mid-market buyout deals across Benelux, CEE, France, Italy and Spain have remained consistent with recent years. However, unsurprisingly the UK counters that trend and weighs the total volume of European deals down 17% for Q3 from the same period last year.
The sentiment during the quarter – i.e. corporates’ lack of confidence in the current European market – has enabled private equity funds to seize deals that may have been previously destined for trade. Hope for the coming period comes from the volume of dry powder currently available. Volumes have remained high, with funds spending more time developing alternative sourcing methods, such as take-privates and corporate carve-outs, which were both a prevalent source of deals this quarter.
The quarter has shown a decline in deal volumes for all sectors except Healthcare which has proven the most resilient with the same number of deals completed in Q3 2019 and Q3 2018. TMT has exhibited the largest decline (YOY -24%), followed by Industrials, Products & Services with a 23% decrease.
European activity snapshot
Q3 buyout activity in the European mid-market (#of transactions)
Buyout volumes 2014 – 2019 YTD, split by sector (%)
Buyout volumes Q3 2019 split by sector (%)
Buyout volumes in 2014-2019, split by region (%)
Buyout volumes in Q3, split by region (%)
YTD activity by sector and region
2014-2019 YTD total deals by region (#of transactions)
Who’s been fundraising?