Member Article

Two Yorkshire deals amongst largest private equity exits in Western Europe

Deals involving five Northern companies, including two from Leeds were amongst the top 20 largest private equity exits in Western Europe in the first three months of 2014.

According to Ernst & Young, this highlights the strength of the region’s corporates and the potential opportunities for mid-market buyout houses in the North of England.

Taken from EY’s newly released Multiple report, data from the EY and Equistone Partners Europe-sponsored Centre for Management Buyout Research (CMBOR) shows that five Northern exits had an aggregate value of €2.6 billion, helping to make up the top 20 biggest exits in Western Europe in Q1, which totalled €16.1 billion.

The sale of Leeds-headquartered Callcredit Information Group was in the number 10 spot, whilst the 17th exit was Zenith, also of Leeds.

The €1.5 billion floatation of Handforth-based Pets At Home was the third largest exit in Western Europe and the biggest in the UK.

Hotter Shoes and Manx Telecom were the other North of England exits in Western Europe’s top 20. The North was the best represented UK region in Q1 2014 in Western Europe’s top 20.

London had three exits in the table, the South East and the Midlands each had two, and the East of England had one entry.

These 13 UK exits represented more than 40% of the total value of the top 20 exits in Western Europe.

The two largest exits, Denmark-based ISS (€4 billion) and Germany-based Friedrich Grohe (€3 billion) made up a further 44% of the total value of the top 20.

Mark Clephan, corporate finance director at EY in Yorkshire, said: “The number and quality of private equity exits in the North in Q1 reflects the strength of the region’s mid-market businesses in delivering value and how well the Northern buyout market has effectively held up during the downturn to produce these realisations.

“Alongside improving economic conditions providing buyers with better visibility of future performance, the continuing UK IPO market revival - in which North of England businesses have played an important role - has been a core factor in helping to deliver these exits and reinforce the North’s status as one of the best destinations for private equity investment in Europe.

“Given the pool of sponsor-backed businesses in the North of England, as well as favourable IPO conditions and the improving economy driving company performance to encourage the start of sale processes, we could see a steady flow of lower mid-market and mid-market exits in the North as the year goes on.”

This was posted in Bdaily's Members' News section by Clare Burnett .