European buyouts top €60bn in 2003

Mid-market transactions rose significantly last year, accounting for almost one-third of all European buyout activity.

Overall growth in the European buyout market in 2003 was fuelled by strong mid-market activity, particularly in France and Germany, according to data commissioned by Bridgepoint Capital and compiled by Initiative Europe.

A total of 397 transactions in 2003 accounted for a rise of four percent in the total amount invested in European buyouts to €60.7 billion ($73.7 billion).

With a 38 percent share, the UK remains the largest buyout market in Europe, more than double that of any other country, the research shows. Although the number of transactions fell by five percent in 2003, the amount invested rose by nine percent to €22.9 billion ($27.8 billion).

The growth in the European market was led by strong buyout activity in the mid-market, defined as the market segment of deals with a €50 million to €500 million enterprise value. The mid-market accounted for almost one-third of all transactions.

The volume of mid-market buyout deals increased by 41 percent and the value of those deals rose by 27 percent, up to €12.9 billion.

Outside the UK, France saw the largest growth in buyout volume, with a 52 percent increase in number of deals. The value of these deals was down 29 percent at €9.5 billion.

The German and Italian markets both enjoyed significant growth, principally due to large media deals in Germany and three €1 billion+plus buyouts in Italy.

In terms of sector activity, the support services industry saw the highest number of buyouts in 2003, up 47 percent on 2002, with the UK accounting for almost half of the total number of buyouts in the sector.

Investments in the leisure sector, including pubs, rose by 39 percent, with over two-thirds of investment by volume in the UK.

In a statement, Julian Longhurst, head of data and research at Initiative Europe, said the increasing levels of activity in the mid-market sector were the best sign yet that investor confidence was once again on the up.