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European Private Equity GPs Bullish On Fundraising Prospects In 2020

European private markets trade show IPEM has published the results of its annual private markets survey, finding European private equity GPs bullish on their prospects of raising capital this year.

Almost three-quarters of the survey respondents (72%) said that they expect 2020 to be a good year for European GPs to raise money, and slightly more than half - 52% - said that they plan to raise larger funds. 59% say that they expect the number of GPs to increase, particularly in the Belgian and Dutch markets.

It's not all rosy, of course. High valuations has been a zeitgeist of the global private equity industry in recent years, and 86% of respondents - up from 79% in 2019 - say that this issue is still prevalent. 39% of managers say that, because of valuation issues, finding attractive investment opportunities will be difficult this year.

At the industry level, healthcare/pharma is the number one target industry for buyout fund managers in Europe and for the VCs and growth equity investors, cybersecurity appears in the top three most attractive investment prospects for the first time. Perennial hot topic ESG is now the second most imporant internal topic for private equity fund managers, with talent management in first place.

“Despite the palpable caution of private equity professionals about the European economy, this barometer outlines the excellent mood of the industry at the start of 2020,” says Antoine Colson, chief executive at IPEM.

 “While the high valuation environment is expected to last - and even worsen - European GPs are showing strong confidence in their model and in the asset class. The expected increase in cross-border deals is also confirming that private equity has really become an industry at a continental scale. Another fascinating finding is the emergence of a genuine European model for private equity that places its contribution to society and ESG on top of the agenda.”

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