Fresh slump in value of buyouts

THE value of private equity-backed buyout deals fell by a fifth in the first three months of the year, according to data published yesterday.

The 669 deals were valued at $46.3bn (£29.1bn) in total, down 20 per cent from the final quarter of last year and the lowest value of buyout activity for two years, according to Preqin.

It said, however, that deal volume has held up, with the number of deals in the first quarter of 2012 matching the average of 663 deals per quarter during 2010 and 2011. Manuel Carvalho, private equity deals manager, said: “This decline in deal and exit flow has come during a prolonged period of volatility in the financial markets, which has led to a difficult global merger and acquisition environment, particularly when it comes to obtaining leveraged financing for larger-sized deals.”

European deal values in the first quarter hit a two year low. Two of the few bright spots came when Dutch cable company Ziggo and Swiss group DKSH listed last month. Buyout firms Warburg Pincus and Cinven were the biggest beneficiaries of the Ziggo issue.