Large-cap deals drive strong start to 2018 for European PE

Greg Gille
28 February 2018

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The European private equity industry has been off to a strong start in the first two months of 2018 when compared with the same period last year, according to Unquote Data.

Although the first days of January were characteristically sedate with regard to new deal announcements, the market quickly picked up as processes that were initiated at the tail-end of 2017 came to fruition.

According to figures collated by Unquote Data, Europe has already been home to 135 buyouts between 1 January and 27 February. This is already a slight uptick volume-wise compared with the figure recorded for the first two full months of 2017. But it is the aggregate enterprise value of €22.3bn for these buyouts that stands out – it already exceeds the €15.5bn recorded over January and February last year by a healthy €7bn, and significantly exceeds the amounts recorded over comparable periods in the years prior.

This was largely driven by a strong showing at the upper-most end of the market; Unquote has already recorded eight buyouts valued in excess of €1bn in 2018, for an aggregate EV of €14bn, compared with just €5bn over three deals in the first few weeks of 2017.

The UK has struggled to match the pace recorded over January and February last year. So far in 2018, the region has been home to 24 buyouts for a total of €2.7bn. This is down by more than a third volume-wise, and by almost 50% in terms of aggregate value

Standouts in January and February 2018 have included the DKK 33bn take-private of Nets by Hellman & Friedman, and the $1.3bn carve-out of Wyndham Vacation Rentals by Platinum Equity. France has been particularly fertile ground, with a trio of mega-deals already boosting the country's 2018 tally: Fives, Albéa and Circet.

In fact, France has been off to a strong start across the board, with overall buyout activity up in terms of both volume and value compared with the first two months of 2017. The Nordic region saw a significant hike in aggregate EV to more than €5.1bn, largely on the back of the Nets deal, while buyout volume remained comparable between the first two months of 2017 and 2018. The DACH region is also off to a very similar start compared with last year, with around €3.8bn deployed over 23 transactions.

The UK, meanwhile, has struggled to match the pace recorded over January and February last year. So far in 2018, the region has been home to 24 buyouts for a total of €2.7bn. This is down by more than a third volume-wise, and by almost half in terms of aggregate value.

The Europe-wide pickup in activity comes on the heels of a Q4 slowdown. The latest Unquote Private Equity Barometer, published in association with Aberdeen Standard Investments, showed that European private equity deal volume and aggregate value slid 10% and 6% respectively in the final quarter of 2017.