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EVCA final figures show record investment in 2007

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The EVCA has released its final figures for private equity activity in 2007, with the report showing that a record EUR73.8bn was invested across Europe, EUR2.6bn higher than in 2006. Buyout investments made up around 79% of the total at EUR58.3bn, despite only representing 23.7% of the number of deals, with mid-market transactions leading the way and representing a third of the total amount invested in European companies. Early-stage deals, although making up only 3.6% of the amount invested, accounted for a substantial 38.9% in terms of volume. Meanwhile, regionally, the UK market continued to dominate with over EUR20bn being invested in UK-based companies. Similarly, UK-based funds also invested by far the highest amount across Europe, accounting for almost half of the total figure with EUR34bn (see graph opposite).

Significantly, 2007 was the also the first year that sales to other institutional investors exceeded trade sales. The total amount divested at costs was EUR27.1bn, an 18.6% drop from 2006, with secondary buyouts accounting for 30.4% of the total against 28.2% for trade buyers. As for the total number of divestments, trade sales accounted for 23.9% and sales to other private equity houses had a share of 13.8%.

In fundraising, EUR79bn was raised in 2007, which is lower than the level seen in 2006 but almost 10% higher than 2005, with EUR60bn of this being allocated to buyouts. About half of the capital raised in 2007 was concentrated in 14 individual vehicles that closed above EUR1bn. As for investors, pension funds (18%), banks (11.8%) and funds-of-funds (11.2%) were still the largest sources of capital. The US and the UK remain the main sources of funds raised in Europe, with the US representing 19.5% of the total and the UK close behind with 16.9%. For the first time, Greece made it into the top five countries with 9.2%, putting it ahead of Germany and the Asian countries. New funds raised in 2007 reached EUR77.3bn excluding capital gains, dividends and interest available for reinvestment.