Private equity fundraising for investment into companies across Europe hit its highest level since 2008 last year at €74.5bn, a 37% year-on-year increase, according to new data from Invest Europe.
The association, previously known as the European Venture Capital Association, describes its 2016 European Private Equity Activity report as the industry’s most comprehensive and authoritative source of activity data.
SMEs benefit most
It shows that private equity investments totalled €53.7bn last year, the second-highest amount since 2008. Almost 6,000 companies across Europe benefited from investment, 83% of which were small and medium-sized enterprises. Exit activity remained robust at €38.9bn.
“This data demonstrates high investor confidence in European private equity, in an otherwise low-yield global investment environment,” said Michael Collins, Invest Europe’s Chief Executive.
“All European economies are now growing and investors value the proven ability of European fund managers to find attractive investment opportunities across sectors and geographies.”
Pension funds do their bit
In the last four years, calculates Invest Europe, European private equity funds have raised over €240bn to invest into companies in Europe, more than twice that raised in 2009 to 2012. Pension funds accounted for over a third of capital raised in 2016.
- Consumer goods and services in Europe received the largest amount of private equity investment last year, at 28% of the total
- The technology sector (communications, computing and electronics) received a fifth of the annual investment
- Business-to-business products and services also attracted 20%
Distribution round Europe
France and Benelux-based companies received more than a third of private equity investments in 2016. Investments in Southern Europe were 19% of the total, mainly driven by increased investments in Italy and Spain.
UK & Ireland and DACH (German, Austria and Switzerland)-based companies each had about 17% share of the total investment, followed by the Nordics at 9% and Central and Eastern Europe at 3%.