02 November 2020

European Buy & Build volume maintained its high level of activity in 2019

Silverfleet Capital, in conjunction with Mergermarket, publishes the findings of its European Buy & Build Monitor for FY 2019. Based on data from respected research company Mergermarket, this year’s report covers global add-on activity undertaken by European headquartered companies backed by private equity during the 12 months between 1st January 2019 to 31st December 2019.

Click here to download the pdf

  • Silverfleet’s European Buy & Build Monitor for 2019 reports 7191 add-ons, down from 724 in 2018
  • 29 add-ons exceeded €65m
  • Total disclosed add-on deal values remained strong, although slightly lower from the previous year
  • The UK saw the largest add-on acquisition in 2019
  • TMT sector outperformed throughout the year with c. 20% of all Buy & Build activity being in this sector in 2019
  • The Nordic region was the most active with 144 add-on deals, with the UK & Ireland in second place with 138 add-ons

FY 2019 maintained its high level of buy and build activity, with 719 add-ons announced, according to Silverfleet Capital’s European Buy & Build Monitor for the year.

Of these, 29 add-ons had values exceeding €65m. This represents a 26% increase from 2018, which saw 23 add-ons within the same bracket. The largest add-on of the year was the £2.97bn acquisition of Ei Group by UK-based, TDR-backed Stonegate Pub Company.

Although slightly lower than FY 2018, total disclosed add-on deal values for 2019 remained strong, totalling €12.1bn, with 94 add-ons disclosing deal values, compared to €13.5bn for the previous year in which 81 transactions disclosed deal values.

The Nordic region was the most active in 2019, with 144 add-on deals announced. The UK & Ireland came in at a close second, with 138 add-ons.

Silverfleet’s activity in 2019 includes the merger of portfolio company Microgen Financial Systems with Touchstone Wealth Management to create the leading provider of technology to the Trust and Corporate Services market. Following the merger, the two original businesses have been fully integrated into a single global organisation – TrustQuay.

This merger not only illustrates the value of Buy & Build as a value creation strategy for Silverfleet, but also its importance in the TMT sector, where there has been a disproportionate increase in the number of add-on acquisitions. Indeed, TMT accounted for c.20% of all Buy & Build activity in 2019.

Commenting on the findings, Gareth Whiley, Managing Partner of Silverfleet Capital, said: “Our FY19 European Buy & Build Monitor shows that popularity for this value creation tool remained very high, particularly in fast growth sectors such as TMT, where add-ons have been an efficient and effective route to achieving scale. We have seen high levels of buy & build activity in Northern Europe in recent years, and the impressive figures produced by the Nordics, the UK and Ireland underline this trend.”

1 For details on the methodology please see the full report.

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