Here's to a merrier 2021

What a year. Most market participants will be happy to see the back of 2020, regardless of individual successes on the deal-making and fundraising sides, and will welcome a return to the potential normality now in sight thanks to vaccine roll-outs.

The full picture of Covid-19's impact on private equity activity will become clearer when final numbers can be tallied up in early 2021. But the early figures highlight how a 2008-style meltdown was averted: overall deal volume is down only 13% year-on-year at the time of writing, according to Unquote Data, with aggregate value down by a quarter. Astonishingly, 2020 will by no means be the quietest investment year in the past decade. And with European players closing 97 funds for total commitments of €99bn between April and early December, LP appetite for the asset class held up well in the pandemic too.

Furthermore, continued dealflow bifurcation will most likely translate to punchy multiples for the foreseeable future. And the same bifurcation in the fundraising market means that the largest players will continue to rake in billions in record time while less prominent players see roadshows stretch out.

Most of the above could have been written back in 2019, and there is certainly something comforting for the industry in the fact that the unprecedented events of the past nine months did not completely shatter the existing private equity landscape.

So, is the "new normal" the same as the old normal? Not quite. First of all, the future remains very uncertain, especially when it comes to the true impact of the pandemic on 2020 financials for businesses, whether they are already in portfolios or potential targets. And the pandemic will have introduced (or at the very least turbocharged) changes to the way the industry operates, from sector shifts in terms of origination to the way deals are transacted and funds are raised.

Whatever 2021 has in store, we hope that you will be able to reflect on useful takeaways from this rollercoaster of a year, and finally get to enjoy some much needed rest with your loved ones as much as is feasible in the current circumstances.

The whole Unquote team joins me in thanking you for your continued support and wishing you an excellent festive season.

Here is a selection of our most impactful recent content before the team returns on Monday 4 January to resume covering the latest European private equity news.

Greg Gille
Editor

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