Southern European market leaves out the exits

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The volume of exits reported in the Southern European market has significantly reduced in Q1 2008 compared with the same period last year. Indeed, Q1 2007 saw 18 exits, with secondary buyouts (six) and trade sales (seven) dominating. In comparison Q1 2008 only saw one exit in each of the aforementioned exit types.

Recent industry commentaries portray trade partners as being in a better position to carry out acquisitions; but it was only in Q2, and particularly Q3, 2007 that we saw more trade sales than SBOs. Nevertheless, for the most part, deal value is still significantly higher for the latter than the former. Only did Q3 2007 experience a higher volume and value of deals at more than EUR1.5bn.

Indeed, if trade partners enjoy better finances for carrying out acquisitions they are also in no hurry. In this case time would seem to be on the side of industrials which are not subject to the constraints of investment and disinvestment phases. Thus they can patiently wait for prices to readjust before pulling out their wallets.