French PE-backed firms outperformed rest of economy in 2012

Greg Gille
11 December 2013

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French private equity-backed companies significantly outperformed their peers in terms of job creation and turnover growth in 2012, according to a new survey by Afic and EY.

The overall turnover of French private equity-backed businesses grew by 4% in 2012, against 0.5% for companies listed on the CAC Mid & Small segment and 1.5% in nominal GDP growth for the French economy as a whole.

Beyond the headline growth rate, businesses backed by private equity following a buyout saw turnover increase by 3.2% between 2011 and 2012. Companies that received growth capital funding witnessed a 5.8% growth rate, while young businesses backed by VCs enjoyed a 23.8% turnover increase.

Meanwhile, headcount for the 2,790 businesses surveyed went up by 3.6% – against -0.6% for the French private sector as a whole. This equated to 79,667 new jobs for portfolio companies, while the overall private sector saw job numbers shrink by 99,500.

Similarly, start-ups saw the largest increase with a 13% progression in headcount. Staff numbers increased by 5.2% and 3% for growth capital-backed companies and businesses that underwent an LBO, respectively.

The job creation figure is an improvement on 2011, when private equity-backed companies created 76,071 new jobs. That said, the revenue growth for portfolio companies mirrored the tougher economic conditions facing France in 2012: overall turnover for private equity-backed businesses increased by 6.8% in 2011, against the aforementioned 4% in 2012.

The 2,790-strong sample took into account businesses created in 2012 and those that went under in that same year.