Growth capital dealflow ebbs in Q1

There were 132 transactions completed in the three months between January and March, 14% less than the 153 transactions recorded in the final quarter of 2012. Compared with the opening three months of last year, the decline is steeper still, with the Q1 2013 figure 33% less than the total recorded in Q1 2012.

Again the value trend tracked that of the buyout market, with value almost halving from €2.2bn to €1.2bn. This is in line with the disparity against the first quarter of last year, with the year-on-year decline in value terms standing at around 50% from the Q1 2012 total of €2.4bn.

That the growth capital sector mirrored the buyout trend – most notably in value terms – is due to the continuing dearth of bolt-on acquisitions for existing portfolio businesses. There were just 16 such ‘acquisition finance' transactions completed in the first quarter.

The largest slice of expansion deal activity occurred in the UK, which was home to 55 deals representing around 42% of overall volume. This included the second largest deal with a disclosed value completed over the three months: the €81m investment by Leeds Equity Partners in educational services provider Into University Partnerships. The largest disclosed deal was completed in Spain: the investment in online software retailer Softonic by Partners Group, which was estimated to be worth €82.5m.

This article is an extract from the latest unquote" Private Equity Barometer. Click here to take a closer look at Q1 2013 activity figures.

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