Although volume and value buyout figures in France have dropped in 2009, the slight recovery seen in the last two quarters could mean that a recovery is underway. Francois Rowell reports.

According to data to be published in the upcoming European Buyout Review 2010, France recorded a substantial fall in buyout volume and value in 2009. Statistics show a 53% fall in the number of deals completed to 48 compared to the previous year and a 78% drop off in terms of value. The fall is even more dramatic when compared with the peak in 2007 - activity has since fallen by 77% and value is down by 91%.

In terms of deal bands the statistics were hardly surprising, with no deals being completed above the €500m threshold, as the lack of financing strangled the top end of the market. Therefore the majority of buyouts completed in 2009 were in the in the small- and mid-cap range.

Indeed, the small end of the market held up surprisingly well compared to the previous year with the <€5m deal band recording the same amount of deals as in 2008. Family divestments and secondary buyouts remained the top sources of French deal flow.

On a slightly more positive note, unquote" statistics reveal that, since a trough in the second quarter of last year, the French buyout market demonstrated slow and steady growth. Subsequently buyout value last year increased by 24% between Q2-Q3 and a further 49% between Q3-Q4. This bodes well for further growth in the first quarter of 2010. 

As a testament to the French buyout revival, AXA Private Equity recently completed the sale its 65.6% stake in Spotless group, a cleaning products company, to BC Partners in a secondary buyout. The deal valued the company at between €590-600m making it the largest buyout deal in France since 2008.

For an in-depth analysis of the European buyout markets refer to the upcoming 21st edition of the European Buyout Review 2010 to be published later this month.