The second quarter of this year saw continued momentum for European unitranche activity, according to a new report by Houlihan Lokey.
The report recorded 132 unitranche deals closing in Q2, a 12 per cent increase on the first quarter of the year. It brings the total to 250 transactions in H1, an increase of 13 per cent compared to the same period last year.
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The UK and France saw the biggest growth in activity, rising 33 per cent and 63 per cent, respectively, while Germany and Benelux saw activity soften slightly, declining by 10 per cent and six per cent.
“The European unitranche financing landscape remains strong, with Q2 2025 showing a 12% increase compared with Q1,” said Thorsten Weber, managing director and head of sponsor finance, DACH, in Houlihan Lokey’s capital solutions group.
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“While much of the momentum has been driven by add-on financings and refinancings, we remain optimistic that broader M&A activity will accelerate in the second half of the year.
“Debt funds show a continued willingness to deploy capital, reflected in competitive leverage levels, aggressive pricing, and favourable other financing terms like financial covenants. However, lenders remain discerning, targeting high-quality assets, resilient sectors, and compelling credit stories.“
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