Paris, le 9 Septembre 2024
Publication of the Aether FS Unitranche France index for the 2nd quarter 2024
The Aether FS Unitranche France index experienced a notable decline in the second quarter of 2024. The margin per round of leverage stands at 1.41%, compared to 1.65% at the end of 2023. The French private equity market remains well oriented despite the announcement of early legislative elections which disrupted the end of the first half.
The Aether FS Unitranche France Index constitutes a benchmark index for market conditions practiced in the field of Private Debt and makes it possible to evaluate the cost per round of leverage (excluding rates basic) in unitranche operations in France. In the first half of 2024, the index was calculated taking into account 34 unitranche transactions carried out for a deployed amount of 4.4 billion euros.
The decline in the index in Q2 2024 reflects a contraction in interest margins, which reached in average 6.10% at closing, compared to 6.46% in the previous quarter. Leverage levels have for their part continued their rebound started in Q4 2023 to reach 4.44x, driven by an economic context more and more buoyant.
After the turbulence of 2022 and 2023, the private equity market has shown signs of recovery in first half of 2024. As a reminder, the number of mergers and acquisitions transactions and the amounts invested had reached historic low levels in recent years due to the rise rates and recession risks.
The announcement of early legislative elections led to a return of caution in June, with some transactions having notably seen their closing postponed, but the small and mid cap segments have proof of remarkable resilience. The technology sector (representing 14 transactions of the sample of our index in H1 2024), health (7 transactions represented in the H1 index 2024) and the energy transition particularly attracted investors, who were more selective and attentive to ESG criteria. These market segments should continue to benefit from the drop in transaction prices and the decline in rates expected in the second half of the year.