14 February 2013
European Buy & Build activity down 30% in 2012
The volume of Buy & Build activity in Europe in Q4 2012 was slightly above the level seen in Q3 2012, with 66*add-ons completed in the quarter compared with 62 add-ons in Q3 2012 but significantly below the 89 add-ons in the same quarter last year. The statistics for the full year showed 275 add-ons being completed, a significant reduction compared to the 395 in 2011.
The average disclosed value of add-ons in the quarter was £52 million*, which was reasonably healthy compared to the Q3 2012 average of £37 million and the average of £34 million seen in Q4 2011. However, the statistics for the full year showed an average disclosed value of only £41 million which is also significantly lower than the £62 million average for 2011.
Commenting on the findings, Neil MacDougall, managing partner of Silverfleet Capital said: “The final quarter of 2012 saw a greater level of Buy & Build activity than in the preceding quarter and higher average reported deal values which is all good news and a welcome change in trend. However on an annual basis 2012 was much weaker year than 2011 in all respects. 2012 was also a weaker year both in terms of the number of add-ons and the average reported deal values than 2010 which goes to illustrate the magnitude of the challenge in completing add-ons that many European buyouts and their sponsoring PE firms faced last year.”