Private equity: 2021 will be the best year in its history in Spain

Funds of Funds Experts
Lower Mid-Market Experts

Sergio García, founding partner together with Eric Halverson of Qualitas Funds, is interviewed by Vozpópuli analyzing the spectacular moment of private equity in Spain. The first six months of the year have not yet been completed, and relevant industry professionals are already convinced that 2021 will be a record year for investment, fundraising and exits.

“It is the consequence of an evolution, it responds to a global trend change in the asset market, and this year it will become evident,” says Sergio García, referring to the greater attraction that of alternative assets, such as private equity, compared to other traditional ones such as the stock market or debt.

“Since 2008, with the financial crisis, the debt has not stopped growing with expansionary policies from Central Banks, this means that low interest rates are maintained and that the returns on traditional investments such as the Stock Market are not so striking”, Sergio has underlined. “And low interest rates are going to continue, with Joe Biden’s or the European Union’s support plans for the economy, they cannot be raised,” he says.

The excess liquidity is also accounted for by Sergio García, even though, Qualitas Funds, invests only outside of Spain, it`s with money obtained mainly from Spanish investors, institutions, private banks and family offices. “At the end of last year, in the midst of the crisis, we closed our third fund, above the target set, with 130 million euros”, he emphasizes, “and we have launched the fourth fund with the expectation of reaching between 150 and 200 million”.

“Before it sounded strange to sell your company to venture capital; Twenty years ago when I visited many entrepreneurs I did not know very well where to start, how to introduce myself, but now they all start talking about ebitda calculations to estimate a price,” says Sergio Garcia.

The optimism of the sector is based on the improvement of the economic and health prospects, which have accelerated the decision-making of investment and sale; in capital accumulation during 2020, a year in which many operations were suspended and are now being resumed. “There is more money than ever,” summarizes most of the sources consulted.

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