Boom in small-cap buyouts

Private equity firms investing in small-cap buyouts are busier than ever, according to unquote's proprietary database Private Equity Insight. Comparing activity in the first half of years 2004 to 2008 reveals that a total of 39 transactions with a value of up to EUR100m were completed in H1 2008, more than double the 17 recorded in H1 2005. The less aggressively leveraged and smaller debt packages typically used to finance buyouts in this space come as a boon - swift deal completion with no reliance on complex club structures.

Contrastingly, deal count in the EUR100m+ space has dropped to a mere 13, returning to 2005 levels following two years of strong growth. This is primarily due to a virtual absence of mega-buyout deals with a value of over EUR1bn. This is in stark contrast to 2007, which saw a record nine such deals completed over the course of the year.

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