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PE deal activity remains strong in DACH region

Portrait of Sascha Haghani
Senior Partner, Member of the Global Executive Commitee, CEO Germany and DACH Region
Frankfurt Office, Zentraleuropa
+49 69 29924-6444
8. August 2019

Political and economic uncertainty worries PE community

Despite growing political and economic uncertainties, private equity-related deal activity has been holding up surprisingly well in the German-speaking region. In the first half of 2019, we counted 138 deals, up from 103 in the same period of the previous year. The outlook remains solid with a healthy number of deals in the pipeline for the third quarter of the year.

The flow of deals was remarkably constant over the first six months of 2019.
The flow of deals was remarkably constant over the first six months of 2019.
"We see a healthy deal pipeline for the third quarter."
Portrait of Christof Huth
Senior Partner
Munich Office, Central Europe

Contributing to the strong deal activity is the ongoing high investment pressure PE firms are experiencing as well as record-low interest rates. Additionally, many of the transactions in the first half of the year were among companies in non-cyclical sectors less affected by the deterioration in economic conditions, eg healthcare.

The deal flow over the first six months of 2019 was very consistent, with 68 transactions in Q1 and 70 in Q2. The bulk of the deals in the DACH region – 117 – were once again in Germany, followed by 16 in Switzerland and 5 in Austria. Over the same period in 2018, we counted 92 deals in Germany, 7 deals in Switzerland and 4 in Austria.

In terms of industries, so far this year deal activity has been highest in the Industrial Products and IT/Telecommunications sectors, followed by Consumer Goods and Healthcare. In contrast, Automotive, Financial Services, Construction, Energy, Transportation and Chemicals all displayed a lower deal activity. While the overall number of PE-related deals is on a high level, a number of transactions have been significantly delayed and/or are not yet closed.

From a wider political and economic perspective, a high level of uncertainty remains a key concern for the PE community. The trade conflict between the US and China continues to escalate as the two countries impose tariffs on each other's products – a development that is expected to also have a negative impact on European countries, as confirmed by a member survey of the EU Chamber of Commerce in Beijing.

Additional political uncertainty comes from the growing threat of a 'hard' Brexit since Boris Johnson took over as UK Prime Minister. After several postponements of the "deal or no deal" decision, the final Brexit showdown is now scheduled for the end of October.

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PE deal activity remains strong in DACH region

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Private equity deal activity remained high in the German-speaking region in the first half of 2019. But market concerns are growing.

Veröffentlicht August 2019. Vorhanden in
Further reading
Portrait of Christof Huth
Senior Partner
München Office, Zentraleuropa
+49 89 9230-8291
Portrait of Sven Kleindienst
Senior Partner
München Office, Zentraleuropa
+49 89 9230-8539
Portrait of Gerd Sievers
Senior Partner
München Office, Zentraleuropa
+49 89 9230-8543
Portrait of Thorsten Groth
Principal
München Office, Zentraleuropa
+49 89 9230-8325
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