
Portfolio companies eager for large bolt-ons
The average value of bolt-ons for European private equity-backed businesses has shot up in Q1 this year, according to a study published by Silverfleet Capital.
While the volume of such deals is on par with Q1 2010, the average value per transaction is significantly higher: the report highlights an average enterprise value of £120m for 15 transactions, as opposed to £41m for 18 transactions in Q1 2010.
"The nascent recovery in deal value shows that buoyance is returning to the buy & build market. After a two-year hiatus, portfolio companies finally feel confident enough to take acquisition risk and dig deep in their pockets to fund bigger deals," commented Silverfleet managing partner Neil MacDougall.
Sizeable bolt-on operations this year include the acquisition of fashion retailer Dress For Less by Privalia – a Spanish online sales club backed by General Atlantic, Highland Capital Partners, Index Ventures and Insight Venture Partners – for €150-200m. A portfolio company of TPG Capital and Credit Suisse Private Equity, Grohe, also grabbed its Chinese rival Joyou for €324m.
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