Why SPACs should be European PE’s new favourite tool

Author: Lizzie Meager | Published: 29 Sep 2017

Private equity (PE) houses in Europe are increasingly turning to a specialised tool that originated in the US to aid them in exits.

While an initial public offering (IPO) may be the most desired route, just 17% of all European PE divestments were achieved in this way in 2016.

"IPOs are usually the preferred goal, but they are not for every company," Chiomenti partner Luca Andrea Frignani said at IFLR’s M&A Forum in London this week.

"Particularly in Europe, where the majority of companies are small to medium-sized enterprises, they have not been the most common method. Secondary buyouts via trade sale have become a more common exit route for PE investors."

The...