Q3 Barometer: Core mid-market buyouts return to growth

unquote" and SL Capital
09 November 2016

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Third quarter mid-market buyout volume rose 13% across Europe compared with Q2, according to the latest unquoteт Private Equity Barometer, published in association with SL Capital Partners.

The aggregate number of deals across Europe slipped to 309 compared to 364 in the second quarter of 2016. This was mirrored by a 23.5% decrease in the total value of buyouts. The downturn in deal volume was accounted for by a decrease in the small-cap and large-cap buyout segments.

Throughout the first nine months of 2016, the European private equity industry saw aggregate volume and value shrink by 22.4% and 21.2%, respectively. At the same time, average deal value increased marginally by 1.6%.

In contrast, mid-market buyouts saw a rise in the number of deals from 46 to 52, with aggregate value also rising from €13bn to €15.6bn. This growth is notable given the third quarter of the year is traditionally a low point for the industry as it coincides with the summer holiday period.

Spain, where protracted political uncertainty weighed on investor sentiment due to the country's general elections, outpaced all other countries in terms of absolute increase in volume terms. Having recorded the highest quarterly deal volume since Q4 2007, Spanish deal activity shows investors remain optimistic about the country's future prospects.

Deals sourced from family and private owners increased as a share of quarterly volume, rising from 75 to 81 deals. "Pass-the-parcel" deals dipped 10.9% as institutional investors' share of quarterly volume shrank.

Read the full report, including detailed commentary and statistics for the growth capital and venture capital markets, as well as regional breakdowns.