CE Private Equity Confidence Survey
Economic Expectations Buoy Rebound in Confidence
Confidence is improving for private equity in CE, with the index climbing by more than a third to 124 points over the last six months. The uptick means it has regained most of the confidence lost in the two years following a drop in April 2014 after an 18-month long continuous ascent.
A quarter of respondents (24%) feel the economy is improving, an eight-fold increase on the last survey. This is in marked contrast to last autumn, when a third expected the economy to deteriorate. “This confidence is crucial to driving deals, and we’re seeing this in CE now,” says Mark Jung, Deloitte Partner and Private Equity Leader.
Nearly three quarters of deal-doers (73%) expect to focus on deploying capital over the coming months. This is perhaps the strongest indication of increasing confidence: in uncertain times, portfolio management becomes the biggest priority, as reflected in our survey over the last 13 years.
“We are impressed that nearly a third of respondents (30%) expect market activity to pick up over the coming months. At the same time, the vast majority (81%) believe average ticket sizes will remain the same. This reaffirms the strength of the region’s mid-market,” Jung says.