Abstract
The paper deals with the analysis of the private equity and venture capital investment and divestment trends and activities on the European market, particularly on the market of Central and Eastern Europe (CEE), in times of economic crises 2007-2009. The analysis is based on the data published by the European Private Equity and Venture Capital Association (EVCA), the Czech Private Equity and Venture Capital Association (CVCA) and the Bundesverband Deutscher Kapitalbeteiligungsgesellschaften (BVK). The economic crisis in 2008-2009 caused a rapid cooling of the European market. Private equity and venture capital management companies located in Europe have decreased significantly both investment and divestment activity. The economic crisis on CEE market showed a delay and a lower intensity in comparison with Western Europe. CEE market is, however, underdeveloped. This argument is supported by the data indicating annual investment and divestment value, and number of companies received private equity financing.
Highlights
The European Private Equity and Venture Capital Association (EVCA) defines Private Equity as the providing equity capital by investors to non-quoted companies
The EVCA study for the CEE region (2010, p.7) pointed out that when we evaluate the development in Central and Eastern European countries, we need to take into account the fact that year-on-year changes reported for individual countries could be directly affected by a limited number of big transactions
Between 2007 and 2009, Private Equity and Venture capital markets in Europe underwent significant changes, both from the point of view of the volume and the number of investments and the volume and the strategies adopted for divestment
Summary
The European Private Equity and Venture Capital Association (EVCA) defines Private Equity as the providing equity capital by investors to non-quoted companies. According to the data published by the EVCA, European companies financed by private equity created over 1 million new jobs between 2000 and 2004, and their employment growth rate on average was 5.4% at the time when the EU25 total employment growth rate was 0.7%. The authors will assess the impact of the 2007–2009 economic crisis on the levels of Private Equity and Venture capital investments and divestments in Europe, and in the CEE region, based on relevant statistical data. The source of data in those documents is the PEREP Analytics statistics platform monitoring the development of Private Equity and Venture capital in 25 European countries. The PEREP Analytics statistics platform is a joint activity of EVCA and 18 national associations representing companies investing Private Equity and Venture capital.
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