By Simon Miller
European private equity and venture capital firms saw the highest level of funding since 2008 last year.
According to the European Private Equity and Venture Capital Association’s (EVCA) annual survey €40bn (£32.2bn) was raised in Europe across the industry as a whole and was the highest fundraising level since the crisis began in 2008.
In addition, fundraising was 80% up on 2010 and investments were a “steady” 6% up on the previous year at €45.5bn
According to the EVCA, this increase had been initiated by both venture capital funds, with a 50% growth of their fundraising activity and buyout & growth funds who doubled their new funds raised over 2011.
In 2011, the number of final closing continued to grow since 2009, reaching almost 90% of the 152 final closings in 2008. This increase has been sustained by the buyout & growth segments: whereas there were 27 final closings of buyout & growth funds in 2009 and 47 in 2010. Sixty funds reached a final closing in 2011.
Three regions (UK & Ireland, Nordic countries and France & Benelux) managed more than 83% of the amount raised in 2011 while around 65% of the total new funds raised came from European countries and about 35% from the rest of the world.
Realised investments were up 50% on the previous 12 months and back at levels last seen in 2005-06.
Karsten Langer, chairman of the EVCA commented: “With investment activity up significantly during 2011 private equity and venture capital are clearly contributing to recovery in Europe. In 2011, fully 85% of the 4,800 companies backed were SMEs, and nearly half employed less than 20 people. It is these businesses that will drive growth and emergence from recession, and private equity investment is helping them to achieve their ambitions.”