Optimism and operations: the bright future of Italian private equity

29. September 2016 Italy 0
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Italian Private Equity Conference

22nd September 2016

Four Seasons Hotel, Milan


Written by Adam Bloch & edited by Rebecca Ford


The Italian Private Equity Conference 2016 took place on 22nd September at the Four Seasons Hotel in Milan. Overall, the tone of the conference was positive, with the Italian market’s recent surge in productivity and transactions setting the bar for an optimistic future for private capital in Italy. Here are our five key takeaways from the Opening Panel on Italian Private Equity Performance.

Italian Private Equity Conference 2016 opening panel

1. Italian private equity is on the up

2015 was an incredible year for private equity in Italy, since more than 4.6 billion was invested in the country, with an increase of approximately 1 billion compared to the previous year. In terms of amounts invested, Italy is now the third-largest country in Europe after Germany and France. Furthermore, if you compare countries in terms of size, Italy is now growing faster than both Germany and France when it comes to secondary buyouts. This is as a result of the global recession, which caused Italian markets to stagnate, though they are beginning to recover nicely now.

italian private equity conference 2016 milan

2. Italy is the “land of the mid-market”

The Italian buyout market can be characterized by cheap financing, a high volume of funds (both international and domestic), and high valuations. It is also said to be the “land of the mid-market”.  In addition, the Italian market is currently seen to be an ideal sellers’ market due to high valuations and cheap financing.

“If you think about the economic footprint of Italy and the national footprint of Italy, a lot of things are owned by families in the mid-market.” – Luca Bassi

3. Competition is the name of the game

The environment is becoming more competitive because sellers are becoming more inclined to run auctions. It’s therefore becoming more important to develop competitive advantages when engaging in an auction. With regards to exits, the Italian market is characterized by many fund-to-fund deals and an IPO market that is not as active as the fund-to-fund market.

italian private equity conference 2016 milan

4. The impact of Brexit will mostly be British

Initially Brexit caused a “flight to safety” as participants waited to see how the market would react, but it is expected that Brexit’s greatest impact will be isolated on the UK in terms of exchange rates and GDP. In the short-term, Brexit has created some volatility within the EU, but from a PE perspective, this could be favourable because this volatility could be exploited if players use the opportunity to find unique assets that have the potential to grow. However, in general, the consequences of Brexit in the EU are not expected to be as severe as previously anticipated.

“From a private equity perspective, I would say that volatility is a good thing… we like to see opportunity in uncertainty.” – Nikos Stathopoulos

5. The future is bright

Looking to the future, based on the assumption that no further major instabilities in politics and the banking system will occur, expectations for the future of Italian private equity are bright. This is due to cheap financing, high volume of funds nationally and internationally, and also because of an open and ambitious market. However, domestic funds need to be invested in infrastructures, despite the fact that the market is dominated by highly-valuated sellers.

Want to know more? Download the official full report of the Italian PE Conference here.

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