European buyouts hits new high

The buyout market on Continental Europe has trebled in value over the past five years, reaching a record €121.5bn in 2006 while the UK market enjoyed its best year ever, reaching €38.8bn.

The statistics are latest to come from CMBOR, the buyouts data specialist. The increase on the Continent can be mainly attributed to the increase in public-to-private deals and secondary buyouts, with the former accounting for €32bn compared to €20.9bn in 2005, and the latter racking up €33.7bn compared with €21.8bn the previous year.

Tom Lamb, co-head of Barclays Private Equity, said: “The size of big deals in Continental Europe is growing with 28 buy-outs valued at over €1 billion compared to 21 in 2005 and just nine in 2004. The largest deal in Europe’s buy-out history ever recorded by CMBOR is still the buy-out of Danish firm TDC for €13bn.”

The same old countries continue to dominate the market in Europe, with the UK leading the way with a €3bn increase on 2005’s figures, with France just behind with a total deal value of €31.5bn – up from €21.6bn the previous year – then the Netherlands on €25.8bn – from €10.3bn – and then Germany with €21.5bn – an increase of almost €10bn.

CMBOR also found that over 50% of exits across Europe take the form of secondary buyouts, demonstrating the continuing power of the private equity industry despite anecdotal evidence suggesting the return of trade buyers to the M&A space.

The number of exits reached 260 last year, up from 2005’s 218, the largest being the flotation of the French company Legrand on the Paris stock exchange for €5.4bn – the largest exit value ever recorded.