Southern European PE deal activity slowed in the first half of 2025, with deal value roughly half that of H1 2024. Deal count for the region was only slightly lower than the same period last year.
So far this year, PE firms have invested €30.5 billion (about $35.5 billion) across 469 deals in Southern Europe. Deal value is about a third of the full-year 2024 total, when the region recorded its second-strongest year in a decade with €103.1 billion invested in 1,107 deals.
PitchBook’s Southern Europe Private Capital Breakdown found that the market this year has been characterized by smaller transactions, with 71.4% of deals valued under €100 million, up from 68.4% in 2024. Add-on acquisitions gained prominence as sponsors sought to build scale efficiently amid uncertain conditions. A notable deal was the €1.2 billion sale of Livensa Living‘s Iberian student housing portfolio by Brookfield to Nido Living, backed by CPP Investments.
Historically, Italy and Spain made up almost 90% of Southern Europe’s deal flow, with Italy’s share rising from 46.9% in 2023 to 50.3% in 2025. This growth reflects a cultural shift in Italy, where family-owned businesses are becoming more open to outside capital. Sponsors have targeted founder-owned companies because of their attractive valuations and potential for operational improvements.
A prominent example is CVC Capital Partners’ stewardship of Italian pharma company Genetic, which doubled its revenues before being sold in May to the Pavese family and local PE partner Renaissance Partners.
Exit activity, however, has slowed in 2025, with value down 15.7% and volume off 27.7% compared to H2 2024. The exit landscape is dominated by sponsor-to-sponsor transactions, representing 53.6% of all exits—well above the long-term average—while IPOs remain rare. CVC stood out with five of the top 10 exits in the region.
Fundraising conditions tightened markedly in H1 2025, with just €2 billion raised across five funds, a steep decline from €6.3 billion in 2024.
Spain continues to outpace Italy in fundraising thanks to a more favorable regulatory and tax environment. With sustained high interest rates dampening large-cap dealmaking, the middle market remains the engine of Southern Europe’s PE activity.
Featured image by Marco Bottigelli/Getty Images
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