Unlock the Editor’s Digest for free
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
President Donald Trump’s “chopping and changing” on US tariff policy is weighing on global dealmaking, said private equity group CVC, as it warned it was cautious about the outlook for selling portfolio companies this year.
The lack of clarity about US tariffs was contributing to a deal market slowdown, Fred Watt, chief financial officer of the Amsterdam-listed buyout group, said on Thursday, a change in fortunes after the market had been “expecting great things” when Trump was elected.
“We remain cautious” about the outlook for exiting investments, Watt told the Financial Times, because corporate M&A and initial public offerings remained subdued.
Many in the industry had predicted Trump’s election would ignite a long-awaited dealmaking boom but instead, the stop-start policy on tariffs has led to economic uncertainty and reduced enthusiasm for dealmaking.
This year has so far had one of the worst recent starts for dealmaking and the share prices of some of the biggest US private equity groups have fallen sharply.
KKR is down about 30 per cent since late January, Blackstone has fallen about 16 per cent and Apollo about 17 per cent. Carlyle Group recently said its fee-paying assets fell in its fourth quarter.
In annual results on Thursday, CVC reported that it made €13.1bn from exiting portfolio investments in 2024, more than double the total for the year before. It expects the 2025 total to be at or slightly above last year’s levels “based on current market conditions”.
The total cash the firm returned from selling investments fell 61 per cent from the first half of 2024 to the second half, because of “lumpiness” in sales of large business.
It beat analysts’ expectations for total fee-paying assets under management, ending the year with €147.3bn of assets, a 50 per cent rise on the year before. Income from management fees grew 23 per cent to €1.33bn.
The growth was driven in part by CVC’s activation last May of its flagship €26.8bn Europe and Americas buyout fund, which made 13 investments in 2024.
“Generally speaking, times when it’s difficult or hard to realise assets [are] a great time to acquire assets,” chief executive Rob Lucas told the FT, adding that events in the US made Europe look “a more interesting place” to invest in.
CVC last year closed its purchase of infrastructure investment firm DIF Capital Partners, which had €16bn of assets under management at the time of the deal.
It is hunting for a private credit firm to buy in the US and for private capital groups focused on real estate outside Europe.
It said on Thursday that it was also interested in partnerships with insurance companies to help them manage assets, a trend in the sector.
CVC beat expectations on performance-fee related earnings, which grew 5 per cent to €182mn. Its exits returned on average four times investor cash last year.
The group’s shares were up 1.5 per cent by Thursday mid-morning. CVC went public in April last year. Its shares are up 40 per cent on its IPO price but have fallen 7 per cent so far this year.
