European buyout boom slows after a surge in final quarter of 2010

The overall value of all European buyouts fell by more than two-fifths in the first quarter of 2011, to £10.3bn, following a strong final quarter in 2010, according to the latest data published by the Centre for Management Buyout Research (CMBOR), sponsored by Barclays Private Equity and Ernst & Young.

The private equity buyout market saw a marked increase in deal activity last year, with the overall value more than doubling.

After a very strong exit market in 2010, the value of private equity realisations declined by 61 per cent, to £6.9bn, in the first quarter of 2011.

However, the total value of European exits this quarter is still considerably higher than the average quarterly deal value of £2bn in 2009.

The UK and German markets led the European buyout market by value and volume in the first quarter of 2011.

In the UK, 44 transactions were completed with a combined deal value of £3.4bn, accounting for 34 per cent of all European buyouts.

There was a sharp rise in total deal value in the UK buyout market in 2010, up to £19bn compared with just £4.8bn in 2009.

UK deals in the first quarter of 2011 have continued to dominate the European buyout market in value terms.

The number of buyouts from family and private vendors remains high, accounting for almost a third of all deals completed in the first quarter of 2011.

Manufacturing continued to be the largest European sector by volume in the first quarter of 2011.