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Q1 Barometer: Fall in buyouts sees aggregate value drop 30%

SL Capital Barometer Q1 2017 — Early-stage deal volume rises to three-quarter high and expansion deals reach four-quarter high, though buyout volumes and values drop

unquote" and SL Capital
08 May 2017

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Despite a 3.6% uptick in deal volume, the combined value of European PE-backed deals fell by 30% in Q1, according to the latest unquote” Private Equity Barometer, published in association with SL Capital Partners.

Overall, the total value of private-equity-backed deals fell by 30% compared with Q4 of 2016, down from €39.3bn to €27.5bn. This was tapered by a decline in the number of large- and mid-cap buyouts, with a fall in aggregate value of buyout deals more than offsetting rising values in the growth-stage and early-stage sectors.

Deal volume rose slightly across all categories, rising from 336 to 348 and bringing to an end eight consecutive quarters of declining deal numbers. The volume of early-stage deals rose to a three-quarter high of 47 from 39, while expansions jumped to a four-quarter high of 149 from 120. However, overall deal volume remained at its second lowest level over the 10-quarter time scale.

Volumes and values dropped across all three buyout deal ranges ( < €100m; €100m-1bn; and >€1bn). The large end of the market lost the most value, down €8.1bn to €7.9bn after Q1 registered five deals compared with nine in Q4. In the mid-market value range, deal value fell by €5.2bn to €10.4bn following a drop in deal numbers from 53 to 42.

Regionally, the strongest increases in deal numbers were in France and Italy, where volumes rose from 73 to 96 in France and 20 to 28 in Italy. The biggest decline was in German deals, which fell to 47 from 72, marking the lowest number of deals in the country over the 10-quarter timescale. The total number of UK deals rose slightly from 88 to 93.

Click here to download the full report, including detailed commentary and statistics for the growth capital and venture capital markets, as well as regional breakdowns.