09 August 2012

European Buy & Build activity remains subdued in Q2 2012

Headline Findings

The volume of Buy & Build activity in Europe in Q2 2012 remained broadly flat at the level seen in Q1 2012, with 63 add-ons completed in both quarters, and this level was the lowest of any quarter since the nadir in mid-2009. However, the average disclosed value of add-ons rose to £45 million, up 72% from a very modest average disclosed value of £26 million in Q1 2012 but still significantly lower than for example the average of £70 million seen in Q3 2011.


Commenting on the findings, Neil MacDougall, Managing Partner of Silverfleet Capital said: “The lower level of Buy & Build activity that we have observed since the real onset of the Eurozone sovereign debt crisis in mid 2011 continued through Q2 2012 with overall activity still very subdued and only slightly above the trough seen in mid-2009.

However, since the ECB’s LTROs we continue to see renewed interest in LBOs from a broader range of lenders especially in France and Germany. It is therefore no co-incidence that Q2 2012 saw a notable resurgence of Buy & Build activity in France especially by French acquirers who completed 10 out of the 13 add-on transactions in that country.

However, in overall terms it is likely that weakening demand and confidence in both domestic and foreign markets is the main explanation for continuing lacklustre Buy & Build activity in Europe.”

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