DACH Trendspotter: German-speaking region fares better than Europe, sponsor resilience offers hope

DACH dealmakers seem to have weathered the coronavirus pandemic better than their European neighbors, thanks in part to the robust government response, strong pre-pandemic activity, and resilience from midcap buyout groups and international buyers. While M&A activity took a significant hit after lockdown measures were implemented, Mergermarket data shows that the German-speaking region reached the end of the first half of 2020 better off than the rest of the continent.

A total of EUR 67.6 bn changed hands via M&A involving targets in Germany, Austria and Switzerland in the first half of this year, 12.2% less than a year ago – a smaller drop than the 29% decrease seen across Europe in the same period. In volume terms, the number of transactions was down 28.1% to 454, compared to a 36.9% fall in the continent, according to Mergermarket data.

Second quarter numbers, which saw value drop to a historic low as lockdowns were enforced, were ultimately made more palatable by deal activity generated by DACH mid-cap buyout groups, which have proven to be more resilient than European counterparts during this crisis. Clairfield partner Dirk Middelhoff noted that “With private equity investors creating special COVID-19 investment structures and other capital solutions at hand we can expect to see a still active buy-side and buy-and-build market.”

Read more in the Mergermarket Trendspotter.



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