The pandemic’s impact on private equity so far: New report shows strong raising but lower investing

Invest Europe

Invest Europe, a Brussels-based association representing Europe’s private equity, venture capital and infrastructure sectors, has published a new report studying the first half of the year: ‘Investing in Europe: Private Equity Activity H1 2020’.

The report shows the disruption caused by Covid didn’t put a dent in private equity fundraising. Funds raised about €49 billion in equity, an amount that’s in line with the first half of 2019, putting the industry on track to raise a full-year total on par with average fundraising levels over the last three years.

Meanwhile funds invested €36 billion, a 17 percent drop from H1 2019, which Invest Europe attributes to tougher trading conditions and dim outlooks. The money backed around 3,400 companies, with about 60 percent going to follow-on investments. This suggests firms were supporting their portfolio businesses through the liquidity crisis caused by economic lockdown measures across Europe. About half of the capital went to ICT (information and communications tech), biotech and healthcare.

“European private equity has demonstrated its adaptability through the crisis caused by ongoing pandemic, supporting existing portfolio companies as and when needed, while continuing to invest in new businesses that require capital and operational expertise to grow,” said Eric de Montgolfier, CEO of Invest Europe.

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