EMEA Private Equity Market

Private equity has become a successful player in investment practices. In this article, we will discuss the nature of private equity and how it has dominated in the EMEA region, especially in the UK and Italy. The second quarter of the year 2019 shall be scrutinized and the frequency of PE investments during this period shall be investigated.

What is Private Equity?

The term private equity is generally used to describe different kinds of funds invested by different investors that are collected in millions and billions for buying shares in companies.
Private equity contains funds from investors directly investing in companies or even buying them out. This kind of fund is not listed on a public exchange.
Private equity may be engaged in buying a company outright. It will collect the funds coming from accredited investors and institutional investors, and use them to buy an entire enterprise.
Private equity’s definition may differ from person to person; however, this may be a general definition that everyone shall agree upon,
“Private Equity is a class of investment that uses the funds generated from a pool of investors and uses it to buy stakes in established companies rather than starting ones.”

EMEA Private Equity

Private equity allows thousands of small investors to buy stakes in large companies. On the other hand, it allows huge enterprises to accelerate their development using the pool money. In this article, we will discuss the latest EMEA private equity investments throughout Europe. The news of huge investment deals in the UK and Italy proves the successful penetration of EMEA private equity into Europe.

A Snapshot of the Second Quarter of the Year 2019

Global General Partners decelerated investment activity in Europe, the Middle East, and Africa (EMEA) in the second quarter of the year 2019. A decrease of 18% was reported in the number of entry deals which resulted in losing 299 deals of the past year. A total of four large deals were successfully closed, valuing at €11.8 billion in total. The numbers from the past year stood at €15.5 billion, which indicates a 14% loss in the aggregate capital deployed, from €28.6 billion to €24.5 billion. On the brighter side, the deal size proved to be quite sturdy and entry size deal grew by 7%, from €33.3 million last year to €35.5 million this year.

The UK Claimed Large Chunks of Investments

Compared to the other EMEA regions, the UK proved to be the most prolific player in securing large chunks of investments from global General Partners’ capital. The large deals secured by the UK included the purchase of equity stakes in Quadgas Midco Limited for €2.3 billion and Travel Port Worldwide Limited for €3.8 billion.
Due to these huge deals, the UK was successful in increasing its investments by 70% to a total of €9.1 billion versus €5.3 billion secured in the same period of the last year. These numbers are surprisingly amazing regarding the 22% loss in the total number of deals in EMEA.

The Rising Middle East

The Middle East was not far behind Europe as it successfully managed to deploy €5.2 billion of the aggregate capital. The single purchase of a 40% equity stake in ADNOC Oil Pipelines – Sole Proprietorship accounted for 67% of the entire chunk of the aggregate capital, valuing at €3.5 billion. The Middle East ended the quarter by securing 85 deals with an increase of 11%.

The Successful IT Sector

If we take a look at the sector-wise investments made by global General Partners, IT stands out prominently among the other sectors, comprising a total of 40% of the overall deal count in EMEA. Rising quickly for the past few years, IT has successfully cemented itself as the favorite area of investment by global General Partners. The second quarter of the year 2019 witnessed an increase of 70% from the last year. The aggregate capital in IT stood at €7.1 billion versus €4.2billion in the same period of the year 2018.

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