The Europe 50 Industrials Edition
Ranking the most active investors in the European industrial sector
2023
Executive Summary
In our inaugural report, “The Europe 250,” we ranked the most active investors on the continent. For a more granular look, we take this one level deeper, assessing investors from a sectoral and geographical perspective. We kick this off by analyzing and ranking the largest and most active investors in the European Industrials sector. Our ranking is based on the size of the underlying portfolio and is calculated with the help of our proprietary algorithm.
Chapter 01: Ranking by size of the underlying portfolio
Similar to what we have seen in our sector agnostic ranking, However, relatively speaking, it can be observed that British funds follow closely behind American sponsors within the sector (€15.0bn vs. €15.6bn managed EV) while French investors (€9.7bn managed EV), led by PAI Partners and Tikehau Capital, also have a narrow gap between them and the US headquartered frontrunners. One of the reasons behind the more limited penetration of US funds (compared to the overall market) might be due to the fact that the US funds are mainly after sizable and international Industrials players, which are scarce in this sector compared to some other industry verticals.
To illustrate, ~18% of identified US-backed companies had >€1bn in sales compared to only ~3% of European sponsor backed Industrials businesses.
Collectively, the top 50 investors in Europe are managing approximately €51bn in European Industrials companies. On average, these funds have 12 portfolio companies in Europe, with a median portfolio EBITDA of €23m. CVC has emerged as the leading player with a total managed EV of approximately €4.8bn, closely followed by Blackstone, managing around €4.7bn. Finally, Triton, who ranks 20th in “The Europe 250,” takes up the 3rd position by closing a third of its deals within the sector.
Chapter 02: Insights
As for some of the most successful deals closed in 2023, it is worth mentioning Capvis’ recent strategic exit from Italian farming components manufacturer, ARAG Group, for €960m EV or 16.5x EBITDA. Furthermore, Tikehau Capital has IPOd EuroGroup Laminations, a producer of stators and rotors for electric motors based in Italy, reportedly making 3x its initial investment in less than 2.5 years. Lastly, Parcom Capital and Smile Invest exited Dutch HVAC producer, CFL, to a trade buyer at 13.6x EBITDA. Regarding notable live transactions in the sector, Triton is currently preparing to list German defence contractor, RENK, at a potential market cap of up to €1.8bn (compared to €700m Triton paid to WV in 2020).
Methodology
The ranking is determined by the total managed EV of each investor, calculated by multiplying the number of European Industrials portfolio companies by the median portfolio EBITDA and a predicted EBITDA multiple derived from a proprietary valuation algorithm developed by Gain.pro. Moreover, the managed EV is adjusted when the investor primarily engages in minority investments.
Investors who have executed less than 3 investments in Europe between January 2018 and September 2023 are excluded from the ranking.
The median portfolio EBITDA calculation only includes companies with a positive EBITDA, and the ranking only includes investors with more than 4 EBITDA positive investments in Europe. Therefore, this ranking is focused on traditional buyout investments vs. growth investments.
Fundraising data, investor entries and exits refer to a timeframe from January 2018 to September 2023. Fundraising data includes investors’ global strategies and is not restricted to Europe only.
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