The Swedish M&A market is catching a breather after a period of record-high activity, but the outlook is decent as private equity firms look to exit older investments
Copenhagen, 12 August 2019
Based on our analysis of 481 Swedish M&A transactions over the last 12 months and our analysis of 261 Swedish firms owned by private equity funds, we found the following:
*The number of larger Swedish M&A transactions decreased to 18 in Q2-2019 coming from a very high level of 26 in Q1-2019, as private equity firms did fewer investments while strategic buyers remained very active
*Private equity firms did (only) 4 large acquisitions in the second quarter - down from 11 in the first three months of the year, amid growing concerns for the high price expectations among most sellers
*At the same time, we saw 7 larger private equity exits from April to June compared to just 4 in Q1-2019, which confirms the trend of a growing hesitancy among this type of investors
*We have identified 31 potential "exit candidates" among the 261 private equity owned Swedish firms, which we expect to come to market in the next 0-36 months based on current performance and ownership period
*Given the low interest rate environment and the very large amount of un-invested funds ("dry powder") among the world's private equity funds, and taking the above exit candidates into account, we believe the short-to-medium-term outlook for the Swedish M&A market is decent, although activity levels will be lower than during the recent peak period especially for cyclical assets within consumer goods and retail a.o.
About the data:
The M&A data is compiled daily by Nordic Knowledge Partners' dedicated Nordic analyst team (which includes both Norwegians and Danes), who goes through press releases, company filings, and media reports - the team team logs more than 25 data points per M&A event detected, and currently Nordic Knowledge Partners detects 50-75 M&A situations across the Nordics every week.
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