French figures buck broader European trend

Figures published by the French Venture Capital Association reveal a market buoyed by a significant increase in LBO activity.

AFIC, the French Venture Capital Association, has published figures for the first half of 2002 which reveal strong growth in investment levels and stable fundraising in contrast with the broader picture across Europe.

Investment in French businesses by private equity firms in the first six months of 2002 showed a 20 per cent increase on the same period for 2001, at E1.43bn. However, the total is slightly down on the second half of 2001, when E1.49bn was raised.

The stability of investment levels was driven by an increase in French LBO activity, which rose 87 per cent compared with the same period in 2001. Among the bigger deals was Cinven’s E1.2bn acquisition of the healthcare and business publishing activities of Vivendi Universal.

Fundraising was slightly down on the same period in 2001 at E2.5bn, a drop of only two per cent.

The second half of 2002 is likely to produce better results both in terms of investment levels and fundraising. KKR and Wendel Investissements E3.6bn-plus acquisition of Legrand from Schneider Electric is the largest of a raft of leveraged buyouts which has included disposals by France Télécom and Vivendi Universal.

The second half has also been an active time for fundraising. PAI Management recently closed a E1.8bn buyout fund, France’s largest to date, whilst mid-market firm LCF Rothschild and Access Capital, the fund of funds manager, have launched and closed respectively funds in excess of E200m.