When it comes to European private equity, the term “green shoots” should only be tossed around in a wok with some hot oil and light vegetables. The economy may be hotting up: France and Germany have come out of recession. UK stocks have also rallied by about 40 per cent since March. Yet, for the most part, private equity remains on the chopping board. The recent rise in deal activity – in the second quarter, total transactions rose by 56 per cent to €4.6bn compared with the depressed first three months of the year, according to Mergermarket – has come off a very low base. In the first half, total deal values were only 6 per cent of the level they reached in 2007.

Deals that are being done are smaller, too; average deal size has collapsed by four-fifths from the boom two years ago. There has also been something of a renewed emphasis on energy and utilities’ stable cashflows. Such deals accounted for only 10 per cent of transactions in 2008; now, led by a €480m buy-out of Enel’s gas network, they make up three times as much. Italy and the UK, though both in recession, are the busiest spots. In France, activity has fallen.