Q2 Barometer: Value and volume bifurcation sets in

Unquote team
24 August 2022

Tweet
Facebook
LinkedIn
Google plus
Send to

European private equity activity bifurcated in Q2 2022, with deal value reaching one of the highest levels on Unquote record while volume sank to its lowest in at least four years, according to the recently released Unquote Private Equity Barometer, produced in association with abrdn.

Click here to download the full Q2 Private Equity Barometer

In Q2, deal value reached EUR 102.6bn, a 10% gain on the previous quarter and one of the largest increases seen in years. This outperformance belies a significant softening in volume during the period, as deal count fell to a four-year low of 720, down 23% on Q1.

“This is a consequence of a significant slowdown in venture capital (VC) activity as new macroeconomic and market dynamics emerge, with VC sitting further out along the risk curve,” says Karin Hyland, senior investment director, private equity at abrdn. “This divergence may narrow in the year ahead as interest rates and the cost of financing in Europe rise.”

Aggregate European buyout value surged to EUR 83.2bn in Q2, up by a 27% on Q1 and the highest level in at least four years. This came despite volume easing off by 8% to 280 buyouts in the same period.

Growth capital deals fell by 27% in Q2 to 377 transactions versus 515 in Q1. Early-stage transactions were also down, with a 46% drop on the previous quarter, as VCs sat on the sidelines.