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EVCA activity indicator suggests private equity conditions improving in Q3

European private equity activity picked up in the third quarter to reinforce the glimmering sense of a sustained improvement in conditions, according to new figures from the European Venture Capital Association. Fundraising, investment, and divestment all increased on the previous quarter, EVCA said.

The value of overall investment rose by about 50 per cent on the previous quarter, driven chiefly by buy-out activity but there was also an increase in venture investing. But the number of investments in both sectors dropped modestly.

The total amount divested at cost rose 5.9 per cent on the quarter, suggesting some sort of recovery in exit conditions. There was a 29 per cent increase in the value of trade sales and a 48 per cent fall in the value of write-offs. Write-offs accounted for just 16.7 per cent of all divestments, the lowest level in the year to date.

Jean-Bernard Schmidt, chairman of EVCA and managing partner of French venture group Sofinnova, said: ‘Although not prevalent throughout all European countries, there is a global improvement in the economic outlook, which starts to impact positively the private equity and venture capital industry in Europe.’

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