Private Debt Deal Tracker Spring 2023 (Deloitte)

Summary

• The second half of 2022 recorded 345 new private debt deals, representing a 23% decrease from H2 2021 and a 15% drop from H1 2022.p.2
• M&A activity remained the primary driver of deal volume, accounting for 69% of European and UK transactions over the last 12 months.p.27
• Unitranche structures represented 57% of UK deals and 48% of Rest of Europe deals during the last 12-month period.p.27
• Global private debt fundraising totaled $225.7 billion for the full year 2022, surpassing $218.3 billion raised in 2021.p.36
• European private debt funds raised $12.5 billion in Q4 2022, led by large fund closes such as CVC Credit Partners European Direct Lending III at €6.5 billion.p.37

Key insights

1. Central banks raised benchmark rates as of 15 February 2023 to 4.5% in the US, 4.0% in the UK, and 2.5% in the EU.p.4
2. Global M&A deal value dropped by approximately 32% from $1.9 trillion in H1 2022 to $1.3 trillion in H2 2022.p.10
3. First lien structures, including Senior, Unitranche, and Stretched Senior loans, accounted for 83% of total transactions over the last 12 months.p.27
4. Secondary fund stake trading volume reached $17 billion in 2022, growing more than 30 times over the last decade.p.6
5. Preqin survey data shows 63% of private debt investors intended to increase their allocation in 2022, up from 47% in 2021.p.36
6. The European direct lending team headcounts grew by +79 net investment professionals in 2022 compared to +62 in 2021.p.47
7. The UK remained the largest geographic region for hiring in European direct lending during 2022, representing 65% of total hires.p.47
8. Non-sponsored (private) transactions made up 32% of UK deals and 20% of Rest of Europe deals over the last 12 months.p.31