Even as the rest of the European PE market has experienced a slow start to 2023, France's deal flow and exit activity has demonstrated resilience.
Here are five key charts from PitchBook's 2023 France Private Capital Breakdown to illustrate the country's performance.
Reflecting the resilience of the broader French economy, the country's private equity market had a strong start, with 309 deals worth €25.3 billion ($27.3B US) completed in Q1. This is an 11.9% increase compared to the final quarter of last year in deal volume and a 43.9% uptick in value over that same time period.
France accounted for two of just three European PE mega-deals announced during Q1. These were Providence Equity Partners's €1.4 billion buyout of French automotive data firm A2Mac1 from Five Arrows and Caisse des Dépôts Group's €1.1 billion acquisition of heavily indebted French nursing home company Orpea.
While France has had a strong start to the year, it has yet to overtake the UK as Europe's leading PE market. While much has been said of the flight of financial services workers from London to other financial hubs such as Paris since Brexit, there is still a large gap between the country's respective PE markets, with the UK even extending its lead in terms of total deal value over the last two years.
Appeal among overseas investors for French PE investments is on the decline. Part of the reason for this is French protectionism and tight regulations that have made it difficult for foreign capital to invest. A global slowdown is also forcing some investors to retreat from overseas investing and focus on their domestic markets. The number of non-Europeans involved in French PE deals fell from 40.6% of deal value in 2020 to just 19.2% in Q1 this year.
France's PE exit market continues to be robust, with a handful of mega-deals over €1 billion pushing the Q1 value total to €21.3 billion from 69 exits. That's a 142.5% increase from the previous quarter, with the total equating to nearly half of 2022's full year exit value. Among the big deals is the quarter's largest exit, Groupe Bruxelles Lambert sale of French outsourcing and consultancy firm Webhelp to listed Concentrix for €4.5 billion in March.
Read more: 2023 France Private Capital Breakdown
Correction: This article was revised June 8, 2023 to correct deal numbers for Q4 2022 in the first table.
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Read the orginal article: https://pitchbook.com/news/articles/5-charts-french-private-equity-thrives-despite-europes-stall
