EUROPEAN private equity firms are enjoying their best exit returns since before the financial crisis, with the UK at the vanguard of the renewed activity it emerged yesterday.
The report – published by the Centre for Management Buyout Research – revealed total European exit value in the first quarter was €29.5bn (£21.6bn), the highest since the first quarter of 2007 as private equity firms look to cash in on previous investments.
UK based firms are leading the pack, accounting for just over 40 per cent of exit value so far in 2015, recording four out of the top 10 deals by value completed. Furthermore, the average value of each UK deal was slightly above those conducted in Europe as a whole at £108m.
Within the UK, the south east remained the hub of activity, followed by Yorkshire and the Humber accounting for 27 per cent and 21 per cent of deals by value, respectively. In total, Europe saw 95 exits completed in the quarter, with secondary buyouts being the most popular route, accounting for 46 transactions, followed by trade sales and flotations.
The healthy exit market was backed up by a relatively strong buyout market, which stood at €19.9bn during the quarter, the highest opening quarter since 2008. The majority of buyout deals, defined in the report as occurring when over 50 per cent of shares change ownership, were valued at less than €10m. There were only four €1bn plus buyouts due to an active market in IPOs. However, in absolute terms they contributed most to the total at €7.9bn.
Christiian Marriott, a partner at report sponsor Equistone Partners Europe, said: “The ability to exit companies, and at strong multiples, has been a boon for quality private equity firms, allowing them to demonstrate value to investors.”