Strengthening our Industrial Tech & Services team
Investec is pleased to welcome Matthias Odrobina as Managing Director of our European Business Advisory and a senior member of the global sector team covering Europe, UK, Africa, the US and Asia with impartial advice on cross-border transactions.
Matthias brings deep sector expertise across industrial technology (particular focus on smart industries, B2B software and digital transformation).
He has 20 years of experience as a trusted partner to boards and owners on mergers, acquisitions, divestitures, financings, and buyouts, with a particular focus on the industrial sector, B2B software, and business services.
Contact: Matthias Odrobina
Sector multiples have reset above the long-term median – but the index average masks the real story.
The Technical Services Index is trading at 12.5x EV/EBITDA in Q1 2026, +1.6x above the long-term average of 10.9x and +2.3x above Q1 2025.
Investors are no longer pricing technical services as a single cyclical block. After three years of selective re-rating, the market has unbundled the index into four distinctly priced narratives – power, project execution, recurring service quality, and engineering scarcity – andthe spread between them is at its widest of the cycle.
Resilient deal volumes (67 European transactions in Q1) and a step-up in cross-border participation (40%, vs. low-30s through 2025) confirm that buyer appetite remains intact, but selectivity has sharpened materially.
What’s behind the re-rating
The index has rebuilt steadily since the Q4 2022 reset, but the path has not been linear. Multiples held in a narrow band through 2023–24 as investors worked through the rate-shock repricing, then accelerated through 2025 as backlog visibility, energy-transition capex and the AI infrastructure build-out translated into earnings upgrades – not just multiple expansion. The current premium to long-term mean is being underwritten by delivered earnings, not narrative. That distinction matters for what comes next.
The market is rewarding service models that combine recurring revenues, mission-critical exposure and demonstrable margin expansion – and applying a clear discount everywhere else.
EV/EBITDA: Segment comparison Q1 2022 – Q1 2026
The segment trades broadly in line with the index, supported by a clear and increasingly consistent strategic playbook across the leading platforms.
- Margin ambition has reset structurally upwards across the multi-technical platforms – medium-term EBITA targets now cluster in the 8–9% range, a step-up from the 6–7% delivered through the prior cycle, and forward 2027E multiples already compress to ~8.6x as the market underwrites delivery
- Portfolio repositioning toward energy transition, data centre and pharma end-markets is a segment-wide strategic priority, replacing legacy oil & gas and general industrial exposure
- Bolt-on M&A remains the primary growth engine – leading platforms are deploying capital at a pace materially above prior cycles, supplied by a still-fragmented European mid-market
- Pricing power has shifted to providers as labour scarcity in skilled trades has changed the negotiating dynamic on outsourced industrial maintenance contracts
- Mission-critical backlog mix is rising – multi-technical service contracts are increasingly anchored in regulated, safety-critical infrastructure, lifting the recurring component of revenue
Investors are paying for delivery on stated margin paths and continued M&A optionality. Tolerance for execution slippage is limited.
The standout segment of the cycle, with a valuation premium of ~16 turns versus Facility Management – pricing structural exposure to the most concentrated capex super-cycle in industrial services.
- Combined backlogs across the cohort have grown +34% year-on-year, with hyperscaler-driven data centre work the fastest-growing pocket and electric grid build-out providing a multi-year secondary leg
- Customer mix has pivoted decisively toward technology buyers across the cohort – hyperscaler and data-centre work is now a meaningful share of new awards across the cohort, with the most exposed names having moved from a structurally limited share of revenue to majority technology exposure inside two years
- Capacity expansion is the segment’s strategic priority – both physical capacity and contracted labour pools through master service agreements are being scaled materially across the cohort to convert record backlogs
- Selective M&A in specialty electrical and mechanical adjacencies is reinforcing premium positioning rather than diluting margin
- Margins are at or near cycle peaks and balance sheets are increasingly net cash, providing optionality without near-term re-leveraging risk
The risk is asymmetric: 24.0x embeds a multi-year continuation of current capex trajectories. Historical analogues from prior pauses suggest 30–50% multiple compression within weeks of any confirmed inflection. Investors are paying for backlog duration, not cycle-stage normalisation.
The structural laggard of the index – but the discount is becoming differentiated, and that bifurcation is the more important development.
- The segment-level discount reflects genuine fundamentals – lowest aggregate growth (4.8% in 2025/26), thinnest margins (6.9%) and highest leverage (2.2x net debt/EBITDA)
- Mix shift away from manned services toward technology-enabled and compliance offerings is the defining strategic playbook for the leaders
- Balance-sheet discipline through systematic capital return – sustained buyback programmes and progressive dividends – is increasingly part of the equity story
- Selective M&A in higher-margin adjacencies is repricing the leaders – security technology, integrated workplace technology, compliance and TIC services have transacted at multiples well into the teens
- Evidence of strategic delivery is accumulating at the leading end of the segment – long-stated medium-term margin targets are being hit, technology mix is now meaningfully contributing to profit pools, and contract pipelines have expanded materially through the most recent reporting cycle
- The laggards have validated the discount – material guidance downgrades among segment incumbents, including organic growth resets to near-flat and margin reductions of more than 100 basis points within a single fiscal year, reinforce the case for selectivity
Buyers are paying up for technology mix and recurring contract quality. Pure manned-services exposure remains comprehensively discounted.
The most strategically coherent segment in the index, and the one where M&A is most actively reshaping the peer set.
- Three converging structural advantages underpin the premium – highest aggregate margins in the index (11.6% segment median FY26 EBITDA, with the upper quartile delivering 17–18%), multi-year backlog visibility through long-cycle programmes, and direct exposure to scarce specialist verticals
- Scarce-vertical exposure is the primary valuation driver – nuclear new-build and refurbishment, water infrastructure, grid and energy transition, and defence
- Strategic acquirers are paying materially for energy positioning – recent transactions in energy-transition consulting have priced at 14–15x pre-synergy EBITDA, well above the wider segment average
- A margin-convergence story is playing out across the leading end of the segment – platforms with publicly stated medium-term Adjusted EBITDA targets in the 17–20% range are now at or within 100 bps of those targets
- Capital allocation is broadening from M&A-only toward buybacks as platforms approach their margin targets, signalling cycle maturity at the leading end
Premium pricing of scarce specialist capability and disciplined margin convergence at the leaders will drive most of the stock selection within Engineering through 2026.
M&A activity – selectivity, scale, and the rise of cross-border
Q1 2026 confirmed two of our central theses on the European deal market. First, transaction volumes have remained resilient at 67 deals – broadly in line with the four-quarter average – despite higher financing costs, indicating that strategic and sponsor capital deployment is now structurally embedded rather than cycle-dependent. Second, and more importantly, cross-border participation rose to 40%, materially above the c.33% trailing pattern of the past two years.
The cross-border step-up reflects two reinforcing dynamics. Strategic acquirers – particularly those repositioning toward power, energy transition and nuclear – are reaching across borders to acquire specialist capability that cannot be built organically at the required pace. Sponsors, in parallel, are increasingly comfortable underwriting multi-jurisdictional roll-up theses where local-champion platforms can be combined into pan-European leaders. Recent benchmark transactions in the period – including a $3.3bn engineering acquisition disclosed at 14.5x pre-synergy EBITDA and a c.€4bn sponsor recapitalisation in European facility management at an estimated 12–13x – confirm both the depth of capital available and the multiples that scale platform assets continue to command.
For owners, this matters concretely: competitive tension in well-run sale processes is increasing, and the buyer universe for premium assets is materially larger today than in any year since 2021.
Investors reward profitable growth
The two charts make the underwriting model of today’s market explicit. Forward sales growth tracks tightly with FY26 trading multiples – each percentage point of expected growth corresponds to roughly half a turn of EV/EBITDA – while FY26 EBITDA margin shows no meaningful relationship at all. Read together, the pattern confirms what the segment commentary has set out: the market is paying for visible, contracted growth, with margin acting as the qualifier that separates underwritten growth from narrative growth, not as a primary driver in its own right.
What this means for owners and investors
For entrepreneurs, the message is sharper than at any point in the past three cycles. Premium valuation outcomes are increasingly driven by recurring revenues, demonstrable margin resilience, and the ability to articulate strategic relevance within a defined value chain – not by aggregate growth. Top-line CAGR alone no longer commands a premium. Buyers are dissecting revenue mix, contract duration, and end-market exposure with substantially more discipline than they applied during the 2021 peak.
For investors and strategics, selectivity is paramount. Scaled platforms with clear consolidation theses, recurring service exposure, and defensible end-market positions continue to attract the deepest pools of capital and the highest exit multiples. Generic exposure – to construction cyclicality, to manned-only services, to government-revenue concentration, to mid-cycle margin levels – is being systematically discounted.
In today’s market, valuation premiums are not driven by growth in isolation. They are driven by visibility, resilience and strategic scarcity – and the index dispersion at the close of Q1 2026 is the clearest evidence yet that buyers are pricing accordingly.
The Investec Technical Service Index tracks daily developments across the technical services landscape, covering sectors such as Maintenance & Repair, Installation & Commissioning, Engineering Services, Asset Management and Field Services. The index includes valuations, growth projections, profitability margins and other key metrics. You can find more information on our website and specific industry insights in our latest Industrial Services Report.
Investec has a senior team in Technical Services, who are experienced experts in selling, buying, and financing businesses. If you have questions and would like to know more about valuations, buyer activity and current opportunities in the market – please get in touch: [email protected], [email protected], [email protected]
Michel Degryck, Managing Partner, has been recognised by MergerLinks by Datasite among the Top Investment Bankers in France!
A well-deserved recognition of his leadership and long-standing commitment to clients.
Behind every successful transaction lies trust, judgement and long-term relationships.
Explore the rankings: Top Investment Bankers in France FY 2025
Changing dynamics are supporting conditions for outperformance in the Testing, Inspection and Certification (TIC) sector.
Regulatory developments, technological innovation and evolving client needs are the three biggest drivers of future opportunities to expand earnings, boost valuations and accelerate corporate activity, according to a panel of CEOs presenting at Investec’s TIC conference in London.
Regulatory demands
Regulation remains one of the biggest engines of demand. From construction to pharmaceuticals to healthcare, compliance pressures are ratcheting up across most sectors. Stringent EU directives require continual testing and certification, making third-party TIC services essential for accessing domestic and international markets.
The European TIC market is set to reach over $60 billion this year, with a projected CAGR of 5.3% by 20301. Increasing government, corporate, and consumer standards will drive growth, with tech-enablement and innovative software solutions becoming increasingly important for compliance delivery.
However, it is imperative that TIC providers ensure they bring an “economic value proposition” as well as technical benefits, according to Hugo Cence, founder and CEO of Ekoscan.
Replicability: standardising success
There is increasing demand for replicable and standardised solutions, particularly as providers expand their reach. Jonathan Risch, CEO at Arcxis outlined how important it is to “maintain consistency and quality through rapid growth”. Digitisation and automation have a major role to play in meeting that requirement.
Remote monitoring is facilitating a shift from periodic spot checks to continuous, embedded monitoring. Tech-enabled solutions are also driving efficiency and service advancements, moving TIC providers into roles that deliver ongoing value rather than one-off certification.
This creates opportunities for platforms that streamline workflows, reduce costs, and scale operations. The rise of ‘plug-and-play’ solutions also means that players with proven digital capability are well placed to take share from legacy providers – a dynamic already reflected in recent bolt-on deals.
Seamless servicing: beyond the test
Developing integrated testing, inspection and servicing solutions is another area of growth. Several TIC providers are not just flagging compliance failures but offering problem solving solutions. For example, a failed fire safety inspection could be resolved at the point of service with the tester managing on behalf of the client the supply and installation of required extinguishers.
These add-ons foster deeper, stickier client relationships and drive incremental revenue streams. As outlined by Udo Waltman, CEO at Sansidor, “We’re in a service business. If we don’t focus on what our customers need and want and how to make them successful, we won’t be successful”. Investors in the sector are actively targeting businesses that can digitise the compliance cycle and leverage client data for cross-sell opportunities, reinforcing TIC’s potential to shift from check-box expenditure to value-added partnerships.
Industry fragmentation to drive deals
M&A activity in the TIC sector has seen strong and steady growth since the reopening of markets following the COVID-19 pandemic, with sector activity reaching an all-time high of 153 transactions in the trailing twelve months to June 2025. Turbocharged growth of PE-backed, TIC buy-and-build platforms such as Phenna and Normec, alongside ongoing growth and consolidation by the listed TIC majors, have been key factors in driving increased activity levels in the sector. Europe has continued to be a dominant region for the sector, with over 65% of transactions involving a European target company.2
TIC M&A transactions – trailing twelve months
Source: Mergermarket. Based on acquisitions completed by a diversified set of companies across the TIC sector alongside select private equity acquisitions of TIC platforms
While M&A volumes in the sector have continued to grow, the TIC sector has seen an increase in acquisition valuations – across both <£25m and >£25m revenue TIC companies. Key drivers over the past 5 years include continued activity by larger private equity backed and listed consolidators as well as ongoing, high levels of investment by private equity into the sector – driving EBITDA multiples to c.15.0x for scaled TIC providers:
Increasing valuations over time with scale a drive of values
Source: Investec internal deal database: 2010 to 2025
Key drivers of value in recent processesRecent transactions in the sector have highlighted several key themes as drivers of value, including i) underlying market growth dynamics, ii) differentiation leading to high, defensible margins, and iii) the ability to drive growth through M&A and complementary service offerings – driving cross sell:
Key drivers of value in recent processes
Resilience and outlook
The European market’s resilience and growth potential remain strong. Investment in platforms that can anticipate regulatory shifts, embed technology, and deliver complementary, client-led solutions will be key to capturing future opportunities. With compliance demands only increasing, standardisation and scalability are imperative. M&A activity shows little sign of easing, making the sector one of the most attractive areas for investors and corporates that embrace transformation.
TIC Conference 2025 Gallery
Footnotes:
1 Mordor Intelligence
2 Source: Mergermarket. Based on acquisitions completed by a diversified set of companies across the TIC sector alongside select private equity acquisitions of TIC platforms
3 Source: Investec internal deal database: 2010 to 2025
A day full of inspiration and intensive exchange
On 16 September 2025, Investec Advisory together with FINANCE Think Tank co-organised Dealsourcing 2025 in Frankfurt/Oberursel. With over 1,000 industry experts from M&A, private equity and corporate finance, it is one of the largest events in the German corporate finance community.
Pressure to sell or investment crunch: what is driving financial investors?
In the opening plenary session, Ervin Schellenberg, Managing Partner Investec Advisory together with Matthias Weidner, Head of Business Development DPE Deutsche Private Equity, made a clear statement on the current market situation: “Those who need to sell will sell. Those who still have time will first work on optimising their business.” This quote illustrates the current bifurcation of the market: On the one hand, there are companies that have to sell due to pressure, and on the other, there are companies that are optimising their processes and business models before engaging in transactions.
Holger Truckenbrodt, Partner Investec Advisory said: „Great opportunity to get in contact with new potential business partners that weren’t on my radar screen so far.”
In addition to the plenary session, Investec Advisory organised two well-attended workshops:
Is the next wave of M&A coming in healthcare services?
Matthias Holtmeyer, Managing Partner Investec Advisory, discussed the question of whether the healthcare sector is facing a new phase of consolidation and what opportunities and risks investors can expect. A big thank you to our panelists Martin Spirig, Partner at Invision, Ingmar Wegner, Managing Partner at CONVALES, and Dr Thomas Willaschek, Partner and specialist lawyer for medical law at Luther Rechtsanwaltsgesellschaft.
Modern Food – an M&A niche with great potential
Jürgen Schwarz, Managing Partner Investec Advisory led the session, providing exciting insights into the current M&A trends in the food sector from the perspective of manufacturers and investors. A big thank you to our panelists Carsten Hackel, CFO Germany Nestlé, Andreas Holtschneider, Partner PAI Partners, Godo Röben, Supervisory Board & Advisory Board for Plant-Based Foods, and Fabio Ziemssen, Partner Zintinus.
Both sessions addressed highly topical issues and offered not only exciting insights, but also the opportunity to engage directly with industry leaders.
The focus for Investec Advisory was on exchanging ideas with clients, partners, and new contacts. Many of our conversations showed that personal networks are key to success, particularly during challenging market phases. The event provided an opportunity for us to share our expertise, shed light on key market issues and engage in valuable discussions with partners and clients.
We would like to thank all our panelists, contributors and the Deal Sourcing team for the intensive exchange and look forward to Dealsourcing 2026.
Click below for the Aftermovie:
How a professional dialogue is now moving companies forward
Interview with Thorsten Gladiator, Managing Partner of Investec about how a professional dialogue is now moving companies forward:
- Why companies should entertain a professional dialogue with their investors and lenders?.
- What other challenges are companies facing?
- As a financial expert and transaction specialist what advice do you have for companies when dealing with debt and equity investors?
- Giving an example.
This video answers these questions and give you an idea and overview in a few minutes.
Finding the right type of capital and investor to help grow your business
Our team has a long track record of successfully raising equity and debt capital and has the necessary expertise and networks:
- Raising capital to support business growth
- Securing capital from private equity and/or other Investors to support MBO/MBI projects
- Securing capital from private equity and/or other investors to manage changes in the shareholding structure (such as supporting the buyout of one or more shareholders and the reallocation of equity shares)
- Project financing: supporting companies in realizing essential investments or working capital
- Refinancing: supporting companies in reorganizing/reducing their debt burden
We’re pleased to announce a further expansion of our international M&A advisory business with the integration of Capitalmind Switzerland into the Investec brand.
The Swiss team, lead by Markus Decker and Thomas Ellenberger, is proud to join Investec, reinforcing our shared commitment to delivering tailored M&A advice and solutions.
It’s an important milestone for our team and clients, strengthening our presence and capabilities across Europe.
This latest acquisition underscores our commitment to expanding our advisory business, where we now have 300 M&A professionals based across 17 offices globally, and complements the growth of Investec’s integrated offering in Switzerland, which includes private banking, wealth management and direct lending.
“By uniting our M&A professionals accross Europe, we are able to bring fresh ideas and tailored solutions to clients in Switzerland and internationally.”
– Markus Decker, Managing Partner of Swiss office
“This acquisition deepens our Swiss presence and enhances global collaboration, connecting clients to international and local investment opportunities.”
– Jonathan Arrowsmith, Head of Investment Banking, Investec
All our Swiss team members:
Markus Decker, Thomas Ellenberger, Yanik Costa, Dr. Miró Feller, Tim Graber, Kai Kiesinger, Lorenzo Mattei, Luca Stalder and Gabi Korolnyk
Learn more:
Switzerland | Investec Advisory
We at Investec Advisory together with FINANCE Think Tank, are delighted to co-host DEALSOURCING2025 – the leading networking event for the German Corporate Finance community – on 16 September 2025 in Oberursel, near Frankfurt. It is one of the largest events in the German corporate finance community, with over 1,000 participants from the fields of M&A, financing, and restructuring.
Highlights in the opening plenary: “Pressure to sell or Investment crunch: What is Driving Financial Investors?”
Our Managing Partner Ervin Schellenberg and Matthias Weidner, Head of Business Development DPE Deutsche Private Equity will discuss the key question in the opening plenary session.
Workshop 1 at 11:00 am: Is the second M&A wave coming in Healthcare Services?
Matthias Holtmeyer, Managing Partner at Investec Advisory, invites visionaries Martin Spirig, Partner at Invision, Ingmar Wegner, Managing Partner at CONVALES, and Dr Thomas Willaschek, Partner and specialist lawyer for medical law at Luther Rechtsanwaltsgesellschaft, to an expert panel to discuss whether the next wave of M&A activity in healthcare services is coming.
Workshop 2 at 15:30 pm: Modern Food – an M&A niche with great potential
Jürgen Schwarz, Managing Partner at Investec Advisory, invites visionaries Carsten Hackel, CFO Germany at Nestlé, Andreas Holtschneider, Partner at PAI Partners, Godo Röben, Supervisory Board & Advisory Board Member for Plant-Based Foods, and Fabio Ziemßen, Partner at Zintinus, to an expert panel discussion on the question of M&A potential in the modern food sector.
We look forward to a day full of knowledge-sharing, fresh ideas, and new connections.
More on the programme: www.dealsourcing.de
Date: Tuesday, 16 September 2025
Location: Dorint Hotel Frankfurt/Oberursel, Königsteiner Str. 29 61440 Oberursel
Rental as a resilient and scalable solution
In an economy with uncertainty, capital preservation, and a growing appetite for flexibility, the European rental market has emerged as a resilient and fast-growing sector. Driven by small and mid-sized enterprises (SMEs) seeking to reduce capital expenditures and increase operational agility, equipment rental has transitioned from a cyclical option to a strategic business choice. This shift is further fuelled by increasing ESG and sustainability priorities, as rental models enable more efficient resource use, promote circularity, and reduce environmental impact.
In 2024, the global equipment rental market reached $153.7 billion, with Europe accounting for $37 billion and the Netherlands contributing $6.3 billion. Notably, the Dutch rental market is expected to grow at a 5.5% CAGR through 2029, outperforming the European average of 5.2% and closely aligning with global growth expectations.
Resilient growth across key rental verticals
The equipment rental sector spans a wide range of segments, each with unique drivers and robust long-term outlooks:
- Scaffolding Equipment Rental (CAGR: 8.0%): Fuelled by stricter safety regulations, rapid urbanization and construction
- Temporary & Modular Buildings (CAGR: 6.9%): A key enabler for sustainable construction, fast project turnaround, and events infrastructure
- Cranes & Heavy Machinery (CAGR: 4.98%): Supported by infrastructure megaprojects and renewable energy investments
- HVAC & Energy Solutions (CAGR: 4.3%): Essential for healthcare, emergency events, and large-scale construction
- AV & IT Equipment Rental: (6.3%) CAGR: Increasingly driven by hybrid work, online education, and rapid tech innovation
M&A: a consolidating and competitive landscape
After a slight dip in 2023, M&A activity in the rental sector rebounded in 2024, signalling increased confidence in the market. Strategic buyers continue to dominate, accounting for over 50% of all transactions, with strong interest in regional champions and niche rental categories.
According to Investec’s proprietary analysis of ~500 European rental transactions between 2020 and 2024:
- The UK led with 89 deals, followed by France (62), DACH (57), the Nordics (43), and Benelux with 27, home to key consolidators such as Boels.
- The sector sees a relatively high proportion of domestic transactions, particularly in France where 87% of deals remain within national borders.
Meanwhile, large platforms like Ashtead, Kiloutou, and Boels are acquiring in adjacent segments such as mobile lighting, modular buildings, and HVAC, highlighting a growing preference for product/equipment diversification and full-service offerings.
Valuation multiples for listed rental players have recovered in 2025, with average EV/EBITDA rising from 6.0x in 2024 to 6.4x, and the median multiple hitting 7.4x.
Increased interest of financial buyers
Rental businesses’ robust financial fundamentals, high asset utilisation, and repeat customer models have not gone unnoticed. The share of transactions executed by financial buyers rose from 21% in 2023 to 32% in 2024, highlighting their increased interest in the market.
In the Benelux, investors such as Parcom, 365 Capital, ING Corporate Investments, IK Partners, Capital A, Down2Earth Capital, GIMV, and more have (recently) acquired assets in the rental sector.
Investec has advised on numerous rental transactions, including the sale of:
- Coolworld Rentals – a specialist in sustainable HVAC solutions, to GIMV
- Stravers Torenkranen – a leading European supplier of electric tower crane solutions, sold to ING Corporate Investments
- Tibbloc – the French leader in temporary energy systems, backed by Cilclad, also to GIMV
Looking ahead
A growing preference for flexibility and reduced capital intensity is driving more businesses to integrate rental into their operating models. This shift also supports sustainability goals by promoting reuse, reducing waste, and extending asset lifecycles, which is becoming increasingly important to businesses and regulators.
M&A activity is set to keep growing, especially in certain niches and fragmented geographies. Both strategic and financial investors remain interested in the broad diversity of rental applications, platforms and recurring revenue streams.
At Investec, we believe the rental sector offers an exceptional blend of resilience, innovation, and long-term opportunity, making it one of the most compelling spaces in the European mid-market.
For more information and our full 2025 Rental Report, please contact Marleen Vermeer or Thom Deckers.
Investec is proud to announce that our French team is awarded as one of the Best Investment Bank – LBO Small to Mid Cap with a Silver Award at the recent Sommet des Leaders de la Finance in Paris.
Organised by Décideurs Corporate Finance, this event recognises excellence in corporate finance and highlights the work of professionals who lead complex and strategic transactions.
We warmly thank our teams for their dedication, and our clients for their continued trust.
Trends in the T&L Market
The European T&L sector has seen robust M&A activity, with around 1,250 transactions recorded between 2020 and 2024. Market consolidation is driven by strategic buyers and private equity investors, particularly in logistics execution, services, and infrastructure. The UK, France, and the Nordics lead in deal volume. Companies with scalable operations and strong digital capabilities are often valued more highly, as investors prioritize assets that are well-prepared for future growth.
Benelux Market
Benelux remains a key hub for T&L M&A, ranking among the most active European regions for cross-border transactions. Approximately 60% of deals involve international buyers, with UK and Nordic investors being particularly active. The region’s strong logistics infrastructure, central location, and established trade networks make it an attractive target for strategic and financial buyers alike.
Private equity continues to play a significant role in market consolidation, with financial sponsors accounting for ~31% of acquisitions. This trend reflects growing investor interest in scalable logistics platforms and high-performing supply chain assets.
For more insights and our full 2024 T&L M&A report, please contact Jan Willem Jonkman.
Helen Lucas | UK
Jonathan Harvey | UK
Our 14th report comes at a crucial time for the industry, as GPs get back to the business of selling portfolio companies and raising new funds.
2024 was a tough year for private equity and the overriding view from our survey of 253 general partners (GPs)* is that 2025 will be different.
Our findings show an industry which, despite challenges over the past few years, is resilient, adaptable, and anticipating a more favourable period ahead.
Four in five GPs expect deal valuations to increase in 2025 as interest rates come down, helping to clear exit bottlenecks and accelerate investors’ distributions. The outlook for returns is also brighter, with improvements registered across geographies and fund sizes. Close to two thirds (65%) of investors see returns improving in 2025, up from only 24% in 2024.
Dealmakers still must navigate ongoing geopolitical and macroeconomic risk, as trade tariff tit-for-tats continue and conflicts in the Middle East and Ukraine remain unresolved. It is a complex market, but the backdrop for M&A is better than it was a year ago.
Jump to a section:
Future fundraisings
GP commitments
New world of debt
Innovations and exits
GPs at a crossroads
Future fundraisings
In 2024, 21% of respondents expected a down raise for their next fund: the 2025 research shows only 3% anticipating the same scenario.
There is also a large cohort of super-optimists – 38% expect their next raise will be a blockbuster increase of 25% or more over their previous fund.
Limited partners (LPs), however, are expected to remain highly selective in 2025. In 2024, according to PEI figures1, the ten largest funds to close in 2024 all secured more than $10 billion and absorbed more than a fifth of total fundraising allocations while a Coller Capital LP survey2 showed that the top focus for 98% of investors is that a new manager has a team with a strong track record.
Our survey findings tie in with this theme – close to a third of respondents (31%) expect an increasing number of GPs to move into wind-down. However, this does not mean the opportunity for new managers has passed; just 26% agreed that “very few new GPs will be launched”.
Although fundraising conditions are improving, LPs continue to consolidate GP relationships, focusing on managers of scale and mid-market specialists with differentiated investment strategies and exceptional returns.
Fundraising optimism surges
Jump to a section:
Deal valuations
GP commitments
New world of debt
Innovations and exits
GPs at a crossroads
GP commitments
The survey shows GPs are planning to up their commitment from the typical 2% to 3% to strengthen alignment with investors and boost fundraising momentum.
- One in five GPs expect to commit 4-5% of their next fundraise.
- One in ten expect their next commitment to be 6-10%.
- 8% expect to commit more than 10% in 2025.
Managers are taking a blended approach to financing these higher commitments including existing resources, reinvesting carried interest and external debt, which is gaining favour. Most are using two options to fulfil their obligations, with 13% expecting to use three options.
Where are commitments highest?
The findings reveal interesting regional variations when it comes to GP commitments.
UK managers are more likely to be asked for a big commitment: 22% were asked for more than 5% versus just 8% of managers in Europe. Managers in France, meanwhile, seem to be asked for a particularly slim commitment, with more than half expecting to be asked for less than 2%.
Overall, a significant minority of investors expect to up commitments in the future.
Jump to a section:
Deal valuations
Future fundraisings
New world of debt
Innovations and exits
GPs at a crossroads
New world of debt
Debt markets are open for business with a substantial number of new lenders entering the market to provide GPs with enhanced financing optionality.
More than half (54%) of GPs say they will have new lenders to work with in 2024. This marks a shift from last year’s findings, when 56% of respondents saw a contraction in new lender activity. The majority of GPs who took part in our survey are working with credit funds and the top three reasons cited for working with a private credit included higher leverage levels and innovative financing solutions.
UK managers are hopeful that increasing competition will result in looser terms, with 54% of UK managers reporting either private debt narrowing margins or terms loosening generally. Outside of the UK, however, GPs are more cautious, with only 35% forecasting looser terms.
Despite these expectations, lenders are remaining disciplined. Well over a third of respondents (43%) report that leverage multiples have lowered from a year ago.
Competition is fierce for trophy assets in certain sectors, and these companies will be able to negotiate more favourable terms, but lenders will be highly selective.
Interest rates may have come down, but the risk-free rate remains elevated when compared with recent years, making additional leverage costly to service. Debt is available (European leveraged loan issuance climbed by more than 90% in 20243 and private debt managers have $126.4 billion of dry powder available to invest4), but the survey findings on leverage multiples show that capital structures remain relatively conservative.
Covenant flexibility
Even as interest rates have come down, GPs have still had to work hard to protect portfolio companies.
Some 87% of respondents say they have gone to lenders to request covenant flexibility for one or more portfolio companies. Broad economic issues (cited by 41%) and business underperformance (cited by 34%) are the main reasons for requesting flexibility.
Interestingly, close to a third of respondents (30%) have requested covenant flexibility to fund growth as GPs hold some portfolio companies for prolonged periods.
“We will always be open to a conversation about covenant flexibility. If a business is growing and wants to re-lever, or the sponsor wants to hold an asset for longer, loosening covenants can have a positive impact on supporting growth.” – Helen Lucas, Co-Head of UK Origination, Direct Lending, Investec
Lending landscape
As more lenders entered the private equity space, there has also been increased use of some newer debt products. Innovation continues; survey respondents expect ESG-linked lending, fund-level finance and asset-based lending to increase market share.
Around half of the respondents expect credit funds to do more business with their firm during the year, but banks remain highly competitive; almost a quarter (22%) say they expect to place more lending with banks in the next 12 months. Hybrid capital is gaining particular traction for smaller managers with assets of $250m or less, with a quarter of these saying this type of lender will gain the most market share at their firm in the next year.
NAV lending
Net asset value (NAV) finance has proven particularly popular with managers in an environment where liquidity has been constrained.
Four in five GPs said they used NAV finance in the last year, with distributions the most-cited use case (37%).
Uptake of NAV finance looks set to continue accelerating, with two thirds (65%) of respondents who had not used NAV finance previously saying they were interested in taking up NAV loans.
Deployment and operations
Less than half of GPs (49%) have deployed most of their capital in new deals during the past 12 months, with just over a fifth (21%) focusing efforts on smaller bolt-on acquisitions to support buy-and-build portfolios – down from 28% in our previous survey. An increase in the number of GPs deploying most of their capital in equity cures – up to 17% from 11% last year – further highlights the tough backdrop for managers during the past year.
The improving outlook means that the next 12 months should be more favourable for deployment. Somewhat surprisingly, the public-to-private outlook is mixed and not much changed from last year despite low stock market valuations, most notably in the UK5. Some 50% say they expect to look at more public-to-privates but 40% expect to look at less.
Big-ticket take-private deals during 20246 have ensured that P2P remains on the managers’ radars and may result in activity in this area.
“Private equity managers are ready to deploy, but it is taking much longer to originate deals. GPs will be forming relationships with management teams up to three years ahead of a formal process. During the last two years we have seen a number of processes fall over, and it does take time to rebuild before businesses come back to market.” – Kate Gribbon, Head of Financial Sponsor Coverage & Origination, Investec
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Deal valuations
Future fundraisings
GP commitments
Innovations and exits
GPs at a crossroads
Innovations and exits
One of the single biggest challenges for private equity managers through the rising interest-rate cycle has been to sell portfolio assets at valuations that deliver adequate returns.
In tepid IPO and M&A markets, GPs often opted to sit tight rather than offload assets at lower-than-hoped-for multiples. Hold periods remain above long-term averages, with the backlog of private equity-backed companies sitting at record levels7.
This has had repercussions on fundraising – slowing distributions to LPs have limited their ability to allocate to new funds.
Managers looking at exits will explore all options to crystallise returns, with the survey findings ranking expectations for different exit routes in a narrow band.
More than half of GPs (54%) think trade sales will be the busiest exit route during the next 24 months. But after a long barren spell the IPO is back in the frame again, with the typical manager optimistic that two portfolio companies could be an IPO candidate over the next two years.
The squeeze on other exit routes meant there has been greater use of continuation vehicles which are here to stay as a mainstream exit path: more than 40% of GPs say a continuation fund will be an exit option they are more likely to use in the next 12 months.
The UK IPO question
Private equity-backed portfolio company IPOs haven’t always been crowd-pleasers, particularly on UK markets8, but the survey findings show managers warming to the UK stock market – albeit with some reservations.
Some 65% of UK managers who expect to list a portfolio company in the next two years consider the UK a potential venue – although they will also look at other venues such as Amsterdam or New York.
The size of the manager and portfolio is a factor in stock market selection. Larger managers with bigger assets to float think a UK IPO is less attractive, indicating that larger IPOs are considered more challenging for UK public markets.
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Deal valuations
Future fundraisings
GP commitments
New world of debt
GPs at a crossroads
GPs at a crossroads
According to Pitchbook figures, GP-to-GP M&A reached record highs at the end of 20249 and the survey points to a long runway of further deals, with 79% of respondents expecting some kind of change to their firm’s structure.
In addition to GP consolidation deals, new teams are forming in spinouts and minority stake investment is proliferating.
Indeed, 38% of GPs say some partners could leave their firm via a spinout in the next 24 months. This is reflective of a tougher fundraising environment, particularly for smaller managers with assets under management (AUM) below $1bn, where spinouts are more likely as junior partners explore other options when fundraisings stall.
Getting ready to capture growth
Historically, the main driver for taking on third-party capital or merging with another firm was likely to unlock liquidity and facilitate succession. While this reason was selected by 22% of respondents, the majority see a transaction as a tool to provide capital for growth or expand service lines and scale.
Ideally, twice as many managers say they would like to be the acquirer rather than target in a consolidation scenario.
What is also worth noting is that when it came to continuation vehicles, our survey showed that 40% of GPs think there will be more single-asset continuation vehicles over the next 24 months and over 25% thought they are likely to become more specialised. Single-asset continuation vehicles allow GPs to remain invested in a prized portfolio company and could potentially lead to a spin-out by a manager.
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Deal valuations
Future fundraisings
GP commitments
New world of debt
Innovations and exits
* Demographic info
This report is based on 253 responses to an online survey conducted between 7 January and 22 January 2025. Respondents were sourced from a prequalified panel and no PE firm was represented more than once.
178 were based in the UK, 75 in Europe including 22 in Germany, 14 in Spain and 11 in France. Some 34% of respondents were investment directors, other eligible job titles were CFO, VP of finance, director of finance, principal and manager of finance/investments.
Footnotes:
2 https://www.collercapital.com/41-barometer-winter-2024/
4 https://www.muzinich.com/opinions/corporate-credit-outlook-2025-private-markets
6 https://www.ft.com/content/ec9aa2ae-f56a-4373-8c4b-88effc01a25d
7 https://www.mckinsey.com/industries/private-capital/our-insights/global-private-markets-report
9 https://pitchbook.com/news/articles/blackrock-hps-purchase-record-year-gp-consolidation
Our French team is recognised as the one of the most active firm in LBOs, M&A and Debt Advisory
We are delighted to announce that our French team has been recognised as one of the most active firm in LBOs, M&A, and Debt Advisory by CF News, a leading French publication in Private Equity and Corporate finance.
The team has achieved the following rankings:
- #4 in the LBO segment
- #5 in the M&A Small & mid cap (€50 million to €250 million deal value)
- #5 in Debt Advisory
Under Michel Degryck‘s leadership, the French team of 40 cross-sector professionals has continued to deliver results for clients in a challenging environment, delivering tailored and high-quality solutions to entrepreneurs, family businesses, corporates and private equity firms.
“This recognition reflects the trust our clients place in us and the unwavering commitment of our team. We remain dedicated to providing innovative solutions tailored to their strategic challenges.”
— Michel Degryck, Managing Partner, Investec Advisory France
Market trends, Financial operations, and Valuations in the Dutch Market
“The fundamental strength of the electrical engineering sector remains evident, propelled by the accelerating push for energy efficiency, the growing adoption of renewable energy sources, and the emergence of innovative technologies”
Marleen Vermeer – Partner Investec Benelux
This report provides an overview of market trends, Financial operations, and valuations in the Dutch Market.
To access and read the full report click here
Investec announces the appointment of Michael Eriksen as Head of Nordic M&A in support of its strategy to significantly grow its presence in Europe. Michael brings over 25 years’ experience as an M&A advisor to companies in the Nordics.
In his new role, Michael will focus on identifying and pursuing growth opportunities for clients, in line with Investec’s 25-year track record as a trusted M&A advisor to clients globally, particularly in Europe. Investec provides tailored M&A advice to clients, many of whom operate in the mid-market across a wide range of sectors, helping them achieve their growth objectives.
In 2023 Investec acquired a majority interest in Capitalmind and, with effect from today, completes its transition to the Investec brand.
“Companies across multiple sectors in the Nordics are actively seeking opportunities to expand beyond their borders. Michael’s established relationships and expertise will be invaluable as we enhance our M&A advisory capabilities in the region. At the same time, we are committed to bringing our broader expertise to the Nordics, including leveraged finance and fund solutions for private equity, such as GP financing, continuation funds, and NAV facilities.”
Jan Willem, Managing Partner and Board Director of Investec Continental European Advisory BV (ICEA)
“The Nordic region is a dynamic and expanding market. I firmly believe that Investec, with its strong client focus and comprehensive banking capabilities, is ideally positioned to capitalise on the opportunities that lie ahead.”
Michael Eriksen, Head of Nordic M&A
Case Study
Aqseptence Group, a global leader in autonomous water and filtration technology, equipment and system solutions specialising in water treatment and liquid/solid separation, has attracted Oaktree, a leading global investment manager, as an investor.
Oaktree’s investment and expertise will provide Aqseptence Group with the necessary resources to continue to grow and innovate to best serve existing and new markets.
Interview with Baldassare La Gaetana, CEO of Aqseptence Group and Ervin Schellenberg, Managing Partner of Investec, taking us through the process and decision making of Oaktree’s majority investment in Aqseptence in a short video:
- What is the Aqseptence Group? Why a new shareholder?
- What is your sector and investor perception? – Opinion Ervin Schellenberg
- Why is it important to work with an M&A advisor? – Opinion Baldassare La Gaetana
- How was the collaboration with Investec?
For nearly 25 years, Investec has been assisting its clients in reaching their strategic goals, whatever it takes, whether it’s by securing a strategic business, or maneuvering and winning a competitive auction process:
We are particularly adept at advising on the following situations:
- Acquiring (family-owned) companies, groups, or other mid-market companies
- Acquiring subsidiaries or business units from (international) corporates, including carve-outs
- Acquiring businesses from a founder/(majority) shareholder, including succession
- Acquiring shares owned by a private equity firm, family office or other investors
Designing and executing such transactions is what our team does on a daily basis. To ensure success, our team also leverages its extensive experience and unique capabilities, which include: deal intelligence, tactical, technical and project management skills, negotiation skills, and an understanding of the personal interests/sensitivities of relevant stakeholders.
Investec France awarded Best Investment Bank 2024 in LBO Small to Mid cap with a Golden Award, during the last awards ceremony of the Finance Leaders Summit (Sommet des leaders de la Finance) of Décideurs Leaders League, which took place on 29 May in Paris.
Congratulations to all our teams for their hard work , and many thanks to our clients for their trust and support.
Winners 2024 – Finance Leaders Summit
The Rheingau Music Festival is one of the largest music festivals in Europe and organises over 170 concerts every year throughout the region from Frankfurt and Wiesbaden to the Middle Rhine Valley.
Unique cultural monuments such as Eberbach Monastery, Johannisberg Castle, Vollrads Castle or the Wiesbaden Kurhaus as well as picturesque vineyards are transformed every summer into concert stages for stars of the international classical music scene and interesting up-and-coming artists from classical music and jazz to cabaret and world music.
In over 30 years, the Rheingau and its festival have become a centre of attraction for music enthusiasts from all over the world in a unique interplay of culture and nature, music, enjoyment and joie de vivre.
Investec is delighted once again to sponsor the Rheingau Music Festival 2024 and invites you to join us from 22 June to 7 September 2024!
A special feature this year? For the first time, there will be two opening concerts: Traditionally, the festival opens in the Eberbach Monastery, followed by another opening concert in the Kurhaus Wiesbaden. This year’s focus artists are also particularly outstanding: violinist Christian Tetzlaff, cellist Anastasia Kobekina, pianist Bruce Liu and jazz saxophonist Candy Dulfer.
Once again this year, various themes and focuses will ensure a varied and exciting programme. Under the motto “Spot on: Hollywood”, the world of film music comes to life in twelve concerts. Under the motto “Brazil!”, the contrasts and beauties of the country will be explored musically. The programme is also dedicated to the works of Antonín Dvořák and a true classic: Vivaldi’s “Four Seasons”.
The stages of the 37th festival season will be graced by numerous stars from the worlds of classical and pop music. Highlights include star pianist Lang Lang, singers Álvaro Soler, Max Mutzke and Max Giesinger, violinist Anne-Sophie Mutter, opera singer Rolando Villazón and entertainer Eckart von Hirschhausen.
Investec has been a committed sponsor of the Rheingau Music Festival for more than 15 years. This long-standing partnership is characterised by our deep appreciation for the arts and a strong connection to local culture. We look forward to experiencing a rousing summer full of music together with you again this year.
You can view the detailed program here.