Аналитика
ЮЛИ ФРИКЕ
25.10.2011
Эксклюзивное интервью для Private Equity Russia&CIS Journal (PERCIS) Юли Фрике, председателя Европейской Ассоциации Прямого и Венчурного Инвестирования (EVCA).
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EVCA represents the leading private equity market association in Europe. How big is the current private equity market in Europe – how many funds and how much capital under management is there in European PE firms?
There are 1,689 Private Equity firms active in Europe, who are together managing €532bn. We estimate the total number of funds managed by these firms to be around 4,000.
What strengths, weaknesses, opportunities and particularities of European private equity market could You mention?
Strengths:
European Buyouts are attractive for LP’s because Europe is normally seen as a less mature corporate marketplace with greater scope for operational improvements and industry restructuring. Venture Capital is attractive because of the strength of the European technology base, with excellent universities, research facilities and technology corporations.
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Weaknesses:
Venture Capital can be a difficult access to invest in for large institutional investors since the sums required are relatively small. In contrast to the US, Europe does not have a roster of innovation oriented investors that have the right profile to support venture capital. This is why partnership with innovation oriented investors from other regions could be mutually beneficial.
Opportunities:
More strategic partnerships with innovation oriented investors from outside Europe would enable those international investors to get connected to the European technology base and Venture Capital industry.
What rates of return on investment could investors expect to get when investing in European private equity funds?
The spread of performance is very wide among fund managers. However, the best performers tend to be consistent. So giving averages and aggregates is not meaningful. Those institutions with a long term commitment to private equity and venture capital, such as the Yale endowment or Calpers, have seen strong risk adjusted returns throughout the cycles.
Which countries are currently representing the most interest for private equity investors in the region and why?
Central and Eastern European states continue to be attractive to private equity firms, particularly growth capital and mid market firms. These regions are seeing a generation of first time entrepreneurs seeking liquidity and a solution to help the second generation take these businesses to the next level.
Which industries are the most attractive for private equity funds in European countries?
Private Equity and Venture Capital invest across all sectors. Having said this, as the industry mature, firms are increasingly specialising in sectors or at least structuring their investment business along sectoral lines.
How did the crisis affect the private equity market in European countries? Was its impact the same on all countries, or it was significantly different?
Private Equity and Venture Capital has managed the firm crisis exceptionally well. There have been extremely low rates of default of portfolio companies throughout the downturn, and new companies continued to be supported. The credit crunch resulted in more equity going into leveraged buyouts, although the debt markets now seem to be back. Venture Capital continues to invest, although lower rates of Venture Capital investments at the moment are more to do with the structure weakness.
Is the crisis already finished for European private equity market?
This was not a crisis for the European Private Equity market. But the financial crisis precipitated an economic down turn affecting businesses right across the European economy. However numerous studies have shown that Private Equity backed companies have recovered faster from these down turns than their competitors.
What is the current role of the government in European countries in developing and functioning of private equity market, and what do You think the government could additionally do here or do better than it does now?
The current role of the government in European countries is to encourage greater partnerships, in the sector of private Venture Capital funds. Creating a more favorable environment for entrepreneurial risk taking will help developing the Private Equity market.
What three words could describe the European private equity market and its current state?
We would like to talk about European Buyouts and European Venture Capital separately for this question:
European Buyouts: Stable with a bright future.
European Venture Capital: Huge potential.
What are your expectations for private equity market growth and trends in 2011 in Europe?
With about €76bn in dry powder, European private equity firms still have a large amount of capital to put to work and are expected to keep on the investment pace. On the fundraising side, only 30% of the GPs have raised funds in the past three years. Therefore, a large number of private equity firms are expected to start raising new funds in 2011. Furthermore, the increase in distributions stemming from the up-tick in exits should start easing LPs’ capacity to make new commitments to the private equity industry.
