Benelux exit market lifts

Leading the region's exit pack was CVC. The firm made international headlines for pulling off the biggest IPO Belgium is believed to have seen in more than 15 years – as well as this year's largest IPO in Europe – with the flotation of Belgian postal service bpost. The GP even managed to top Cinven and Warburg Pincus's €658m sale of Ziggo shares in April.

But it is not just CVC that reaped high rewards. A number of sales with substantial price tags have been executed so far this year – and June saw some large-cap and upper mid-market exits take place. Dutch waste management group Van Gansewinkel, which is backed by CVC and KKR, sold its subsidiary AVR Afvalverwerking to the Cheung Kong Group consortium – a group of companies owned by Asia's richest man, Li Ka Shing – for €940m. The large-cap sale took place despite the fact that Van Gansewinkel and its subsidiary have experienced their fair share of turbulence over the past few years.

While CVC's partial exit from bpost sat at the top of the pile, HgCapital's sale of ATC Group for €303m in early June also hovered in the upper mid-market. Likewise, H2 Equity Partners' divestment of Sator Holding for ￡176m in April and Summit Partners' exit from Ogone for €360m in February both stayed above the mid-cap threshold.

Of course, a successful exit can only be executed following a fruitful and productive holding period. Given that the region is lacking in size when compared with the rest of Europe, private equity firms operating in Benelux have to act fast and think big when considering the inevitable divestment period at the end of the holding stretch. "Companies in this region need to think about global expansion earlier than those that serve larger domestic markets," says Christian Strain, a managing director at Summit Partners. He puts the firm's successful exit from Ogone down to the company's shift from "a Benelux-based focus and an exclusively European base" at the time of Summit's investment in 2010, to additional offices in Asia, Latin America, US and Middle East by the time the GP exited the company in February.

Trade sales up, secondaries down
The buyers of GPs' portfolio companies this year have mainly been trade players, with a slight increase in the number of trade sales when compared with last year. Secondary buyouts, however, have experienced a severe contraction. Falling by almost half, the number of SBOs has decreased from 28% in 2012 to just 15.4% this year. However, while exits in Benelux have understandably been on the decline since the financial crisis, 2013 looks set to match - if not surpass – the exit yield of 2012.

Interestingly, a small wave of VC-backed biotech IPOs also began to take place in the region towards the end of June. Cardio3 Biosciences and Prosensa, two biotechnology companies backed by a number of venture capital firms including Gimv, Life Sciences Research Partners and Idinvest Partners, listed new shares. While the flotations did not see any of the investors sell up, the offerings could provide an easily-accessible exit route for the companies' backers in the future.

Despite the continually tough market, Benelux players have managed to put the smallest European region firmly on the private equity map recently – a particularly impressive feat for a region that is normally overshadowed by its French and German neighbours.

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• Topics
• Benelux
• Exits
• CVC Capital Partners
• KKR
• HgCapital
• H2 Equity Partners
• Summit Partners
• Gimv
• Life Science Partners
• IDInvest Partners (AGF Private Equity)
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