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Private Equity

Private equity fundraising, investment soars in Europe in 2017

Private equity investment in European companies and fundraising in the region hit decade highs in 2017, according to new data by Invest Europe.

The trade association representing Europe's private equity, venture capital and infrastructure sectors, said in a report Wednesday that total fundraising in 2017 into Europe-focused strategies reached €91.9 billion ($110 billion) — the highest level in the region since 2006. That figure also represented a 12% increase vs. 2016.

The number of private equity funds raising new capital also increased over the year, by 15% to 542.

In 2017, pension funds accounted for 29% of total capital raised. Funds of funds committed 20% of the total; family offices and private individuals, 15%; sovereign wealth funds, 9%; and insurance companies accounted for 8% of capital raised last year. The remainder was raised by other investors, including endowments and foundations.

Among specific private equity strategies, buyout fundraising increased 5% over the year to €65.1 billion. Venture capital fundraising totaled €7.7 billion, down 6% from the record year of €8.2 billion in 2016, while growth capital fundraising grew 41% to €6.8 billion, the highest level since 2011.

Private equity investment in European companies increased 29% in 2017 to €71.7 billion — the second-highest amount on record and 4% lower than 2007's peak level of investment.

Buyout investment was also at its highest level since 2007 and increased 37% vs. 2016 to €51.2 billion. Venture capital investment increased by 34% to €6.4 billion, a decade high. Growth capital investments grew 6% over the year to €11.5 billion.

Invest Europe also analyzed fund exits, finding 3,800 European companies were exited in 2017. Invest Europe said divestments at cost totaled €42.7 billion, which represented a year-over-year increase of 7% and the third-highest level of the past 10 years. The report said this was in line with 2016 figures.

"European private equity saw highs in both fundraising and investments in 2017, demonstrating that private capital markets are deepening as European economies are growing," said CEO Michael Collins in a statement accompanying the report. "This investment capital is supporting European companies of all sizes — helping startups to achieve scale, expanding (small and medium enterprises) and transforming large corporates."