Global private equity saw 7% more capital in buyouts deal value in 2024 than in 2023, according to Preqin’s Private Equity Q4 2024 update.
The aggregate deal value was $511.6bn, compared to $478.3bn in 2023.
Europe was a bright spot for buyouts in Q4 2024, being the only region to record a quarter-on-quarter increase in aggregate deal value. A total of $31.8bn was invested in buyout deals in Europe, up 7% on the previous quarter and accounting for 28% of the global aggregate.
The report further revealed that the global private equity fundraising environment’s challenges seen earlier in the year persisted into Q4 2024, when 182 funds raised $85.9bn.
This represents a drop of 51% by number of funds closed and 64% in terms of capital raised compared to Q4 2023. A total of 952 private equity funds closed in 2024, raising $584bn as reported so far, which is a year-on-year decrease of 26% and 27%, respectively.
However, Victoria Chernykh, lead author of the report, highlights that there may be an adjusted higher number for 2024 fundraising.
While smaller exits prevailed in the first three quarters of 2024, larger exits returned in Q4 2024 when average deal size was $222mn – larger than both the 2024 average ($186mn) and the last five-year average ($209mn). There were 510 exits in Q4 2024, down 19% on the previous quarter. Also of note, there was an increase in IPOs, from 158 in 2023 and 154 in 2022 to 211 in 2024.
In 2023, secondaries fundraising reached $92.4bn, or 12%, of total global private equity funds raised. In 2024, this figure fell by 39% to $56.3bn, while the proportion dropped to 10%. The number of secondaries funds raised in 2024 dropped less dramatically – down 26% to 37 from 59 in 2023 Preqin analysts believe that it remains unlikely that a catch-up in records for Q4 2024 will result in attaining 2023 levels.
In 2024, 33% of the funds on Preqin’s database closed within 18 months, up from 25% in 2023. 3% of closed funds spent more than three years in market, compared with 17% in 2023 and 14% in 2022. These results may indicate that 2023 marked the bottom of the current fundraising cycle.
Victoria Chernykh, associate vice president, research insights, at Preqin said: “We will monitor the European and North American buyouts’ situation as 2025 unfolds, but as noted in our recent Future of Alternatives report, we expect North America to remain the dominant private equity market, with a 68% share of global assets under management in 2029. Europe is expected to account for around 20%.”
