The prospect of strong growth and promising returns made information technology the most targeted sector for European private equity investors in 2019 in terms of deal number, while industrial assets attracted the most capital, according to S&P Global Market Intelligence data.
A total 7,246 entry and bolt-on deals were announced in 2019 in Europe, worth an aggregate €244.84 billion. Of this, IT accounted for 32% of deals by number, and 11% of deal value.
A number of large-cap deals bolstered the IT sector figures, including Thoma Bravo LLC's €3.7 billion gross acquisition and take-private of U.K.-based cybersecurity firm Sophos Group PLC BC Partners' €2 billion acquisition of a 50% stake in U.K. business software company Advanced Computer Software Group Ltd. from Vista Equity Partners LLC and HgCapital LLP and CPP Investment Board Europe S.a.r.l.'s joint acquisition of Norway-headquartered software provider Visma AS for €750 million gross.
Beyond IT, the industrials sector remained a popular bet for private equity firms in 2019, with 1,197 deals completed in Europe. Aggregate deal value in the sector totaled €31.54 billion, according to available information.
Healthcare and consumer discretionary followed with 842 and 835 deals completed, respectively. Healthcare entry valuations surged in 2019 compared across a five-year period as demographic pressures, disruption and efficiencies drove up demand for assets.
Entry valuations were squeezed in both the materials and utilities sectors in 2019, according to available information, and reached a gross transaction valuation of €2.98 billion and €2.8 billion, respectively. There was also downward pressure on consumer staples valuations, with the total value of entry and add-on deals coming to €2.64 billion.