Demographic changes, innovation, and increased foreign investments are driving growth in private equity, but sourcing deals calls for specific know-how
What are the opportunities you see in Europe, and specifically in the private equity sector?
Europe presents significant opportunities in the private equity market, driven by demographic changes, innovation, and increased foreign investment. The mid-market space and infrastructure projects are particularly promising.
The good thing is that private equity is more than ever driven by genuine value creation, and human expertise, and less by financial engineering and leverage. That means more opportunities as people create long-term solutions in areas related to sustainability, demographic changes, and artificial intelligence (AI).
Are there any sectors or verticals where you see the most opportunities?
Demographic shifts are boosting life expectancies and quality of life. Yet governments have limited budgets, meaning private capital is increasingly needed to sustain infrastructure developments. Greenfield projects, which involve creating new ventures from scratch, present lucrative opportunities in Europe by reducing dependency on Asia, especially in nearshoring. Proximity to Africa adds another layer of potential: access to new supply chains, markets, and partnerships that help SME growth across both regions.
At the same time, a major wealth transition is happening now, with baby boomers exploring succession planning. This may open doors for young entrepreneurs to take over existing businesses, helping preserve jobs and stimulate economic activity, particularly in remote areas.
Europe’s strong tech base offers valuable opportunities to improve business operations through B2B solutions, with AI, for example, boosting efficiency and keeping businesses competitive. Europe also has the right legislative frameworks to invest more in renewables and the circular economy. For instance, biomass generation allows European businesses to secure access to energy through the treatment of their own waste and converting it into electricity and heat.
Another area is soil remediation to regenerate abandoned industrial sites, which are in the heart of cities, but heavily polluted. The opportunity is to buy these sites at low prices, then treat, remediate, and clean the land so we can bring these areas to life with a mix of urban activity. This promotes biodiversity, reduces pollution, supports local economies, and has the potential to generate attractive returns.
In terms of deal size, we focus on the smaller mid-market space, a positioning we consider well placed to secure attractive exits, since the numerous large cap funds, fueled by high levels of LP commitments, rarely do primary transactions and depend on players like us for deal sourcing.
How should fund managers identify potential investment opportunities and source deals?
Going off the beaten track to find opportunities will allow fund managers to find more affordable deals in areas with less competition. Despite technology and data we increasingly put to good use when sourcing deals, this approach requires a lot of rolling up the sleeves, and having the right skills and people around the fund.
We bring the know-how around business transmission, soil remediation, nearshoring, and opening new markets in Africa, and are heavily dependent on our team’s network and experience from the industrial world. Structuring those kinds of transactions takes longer, so if you do not have the right skills, you cannot deliver it.
About
Johnny el Hachem joined Edmond de Rothschild in 2002 where he initiated, structured and raised capital for several private equity funds. Johnny has been involved in a large number of private equity transactions in different sectors and geographies, and he currently serves on the boards and investment committees of several funds. He holds an MS in Financial Engineering from ESSEC in Paris, and a BS in Banking & Finance and Political Science from Lebanese American University.
This article originally appeared in European Private Markets in 2025.
This is a sponsored opinion by Edmond de Rothschild. The views expressed are provided as of September 2025, do not constitute an endorsement, recommendation, or any other advice, and are subject to change. The following content does not necessarily reflect the views of BlackRock, Preqin, or any of its affiliates. Edmond de Rothschild is not affiliated with Preqin. Preqin received compensation from Edmond de Rothschild in exchange for publishing this content.