“Dynamics between buyers and seller of assets are shifting once again, slowly tilting back to a seller’s market,” said Nicolas Moura, private equity analyst at Pitchbook, in a press release on Wednesday. Photo: Pitchbook

“Dynamics between buyers and seller of assets are shifting once again, slowly tilting back to a seller’s market,” said Nicolas Moura, private equity analyst at Pitchbook, in a press release on Wednesday. Photo: Pitchbook

European PE dealmaking value increased by more than 25% in the second quarter of 2024, while fundraising activity has slowed, according to Nicolas Moura of the data provider Pitchbook.

The European private equity (PE) market experienced significant growth in the second quarter of 2024, according to Nicolas Moura, Pitchbook PE analyst. In a press release on Wednesday 3 July, Pitchbook noted that the European dealmaking value increased quarter-over-quarter by 27.3%, rebounding from one of the worst quarters in recent years for European PE. This recovery was driven by monetary easing, with the European Central Bank cutting rates in June, stated Moura.

Exit activity

Exit value also saw a notable increase in Q2 2024, rising by 90.3% quarter-on-quarter. This growth marked the beginning of a recovery, as evidenced by the data. In the first half (H1) of 2024, exit value was driven by 23 mega exits, of which 10 were initial public offerings (IPOs). The congested listing pipeline finally began to clear, highlighted by CVC’s long-awaited IPO, which was the standout event of Q2. The outlook for 2024 is now positive, commented Moura, with expectations for the best year for PE-backed IPOs in Europe since 2021, both in terms of count and exit value.

The market dynamics between buyers and sellers of assets have been shifting, gradually tilting back to a seller’s market, argued Moura. Hargreaves Lansdowne’s recent experience exemplified this trend, as the company rejected three bids before finally accepting a take-private offer from a PE consortium led by CVC. This shift was also reflected in the EV/Ebitda multiples in Europe, which showed a trailing-twelve-month figure 300 basis points higher than in 2023. This increase was attributed to signs of monetary easing and expectations of economic recovery.

Fundraising

Fundraising in European PE also showed strong performance in H1 2024, pacing for another record year of capital raised.

Notable megafund closes in Q2 included Partners Group’s Direct Equity Fund V, which raised €14.2bn, Bregal Unternehmerkapital Fund IV at €2.7bn and EQT’s Mid-Market Growth Partnership Fund, which raised €1.5bn. However, the overall fundraising landscape was not uniformly positive. The timelines for fundraising have expanded, with the median duration increasing from 12.1 months in 2022 to 18.4 months by the end of H1 2024, noted Pitchbook.

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