Annual Review 2019
Boat race

Buyouts trigger a boom in Western European PE

European PE activity dipped in 2019, but buyouts held on

Western Europe had a standout year for PE in 2019, when measured by buyout activity.

Total buyout value (primary buyouts and secondary buyouts combined) came to US$162.5 billion, the second-highest level since the financial crisis, fueled both by a surfeit of dry powder and assets that are attractively priced for dollar-denominated funds.

While 2019 buyout value shows a year-on-year decline of 16.1 percent, 2018 saw the highest buyout activity in the region since 2007—the most abundant year for PE.

Looking at the volume of PE investments in Western Europe, 2019 was also an impressive year. The 1,373 buyouts over the course of the year represent the third-highest annual figure on record, and just above pre-crisis levels.

The UK stock market was the most fertile ground for PE dealmaking in Western Europe, in what was one of the defining trends of 2019. Another factor was the narrowing public-to-private premium. Private markets have been attractively priced precisely because of their illiquidity. But unprecedented levels of dry powder, currently sitting at more than US$2 trillion across all private capital strategies, means that—even with a take-private premium factored in—acquiring businesses off the stock market is a compelling strategy.

With a coterie of newly raised megafunds targeting the continent, all evidence points to an abundant 2020 for Western Europe, provided Brexit does not cause too much disruption to M&A sentiment.


Read the source article

Back to the Annual Review landing page


This publication is provided for your convenience and does not constitute legal advice. This publication is protected by copyright.
© 2020 White & Case LLP