7. PE-backed exits stabilized
Following the sharp spike in 2021, exit activity now appears to have stabilized, reaching a total of 71 buyout exits. However, activity varies across countries—while Sweden saw a notable decline, all other Nordic countries experienced a slight increase in exits.
Following a record high in 2021, exit activity has stabilized over the past three years at levels comparable to those seen in 2020. However, these levels remain lower than in the previous decade. From 2010 to 2019 the average number of buyout exits was 18 percent higher.
The exit-market is still challenging. The IPO window is currently closed, and in addition, interest rates have been significantly higher over the past three years compared to the previous decade. These are all factors that affect the valuations and make exits more difficult. According to Argentum’s market data, the average holding period has shown a slight increase since 2021, demonstrating that it is a tough exit market.
Exit activity stabilized: Exit activity has stabilized over the past three years following the record-high levels in 2021.
Significant exit transactions
Some of the most significant divestments during the year includes:
| Company | Company description | Exit type | Seller | Country |
|---|---|---|---|---|
| Provide housing, support, education and personnel for health and social care. | Share sale | Triton | Sweden | |
| Independent upstream oil and gas company. | Share sale | HitecVision | Norway | |
| Focuses on the commercialization of medicines for rare diseases and specialty care. | Secondary exit | Impilo | Sweden | |
| Provides facility management, catering, and support services across various industries. | Trade sale | Norvestor Equity | Norway | |
| A leading investment bank providing financial advisory and capital market services. | Trade sale | Altor Equity Partners | Sweden | |
| Specializes in sustainable waste management and recycling solutions. | Share sale | Summa Equity | Sweden | |
| Develops and provides advanced proteomics solutions for biomarker discovery and precision medicine. | Trade sale | Summa Equity | Sweden |
Trade sales top: After secondary exits emerged as the preferred approach in 2023, trade sale was again the preferred exit strategy in 2024.
Trade sales superseding secondary exits
After secondary exits (sales to other fund managers) surpassed trade sales (sales to industrial actors) as the preferred exit strategy in 2023, trade sales emerged as the most used exit route in 2024. Trade sales represented 40 percent of all buyout exits, while secondary exits accounted for 37 percent in 2024. This distribution aligns closely with patterns observed over the past five years. A notable example of a successful trade sale is the sale of Carnegie by Altor to DNB. Another is Norvestor’s sale of 4Service to Compass Group.
Combined, trade sales and secondary exits account for 77 percent of exits. Other exit strategies were share sales (8 percent of exits) and other exit types (7 percent).
Håvard Berge, Investment Director at Norvestor, stated that the expectations for the market in 2024 were higher than what they evidently saw:
– There was a greater expectation that more assets would have come to market last year, and many of them remain in the pipeline, ready for execution. We expect 2025 to follow a similar trend.
– Overall, there is a growing portfolio of investments that are becoming mature for realization. We view this as a good opportunity to identify new investments as well, he adds.
Norvestor made their best divestment to date in 2024, read more about the exit of 4Service in chapter 8.
Continued growth for exit activity within the ICT sector
The number of ICT exits increased in 2024 and is now back at the same levels as in 2019 and 2020. The impressive growth in exits was mainly driven by increased exits from companies specializing in software solutions, such as BRP Systems and OpusCapita. The surge in ICT exits comes after a historically low number of exits in 2022, attributed to declining valuations. The energy sector also saw a sharp increase in the number of exits. After declining steadily since 2021, the number of exits in the sector rose more than ninefold compared to the previous year.
Despite the high activity, there is no indication of a broad sell-off of ICT companies by private equity funds. In fact, almost 40 percent of the ICT exits were secondary exits, showing that PE funds were involved as buyers in a significant share of these exits. Additionally, as noted in the previous chapter, the ICT sector recorded the highest number of PE investments across all sectors during this period, with industry experts pointing out that this sector is currently experiencing strong underlying drivers.
Apart from the ICT and energy sector, all major sectors saw either a decline or stagnation in exits in 2024 compared to 2023. Industrial and consumer exits decreased by 26 percent and 27 percent respectively, while the health care and life science sector saw the same number of exits as in 2023.
Among large-cap exits, both the health care and life science sector and the financial sector recorded three large-cap exits. The ICT and energy sectors followed with one transaction each. Further details can be found in the chapter covering significant single transactions.
In 2024, Sweden stood out with a total of 23 exits. However, this represents a 26 percent decrease in number of exits compared to 2023. Finland increased their number of exits by 29 percent, while Denmark recorded 16 exits, one more than in 2023.