In between the on-and-off again machinations of Europe’s IPO market, private equity houses are preparing a return to market to sell-down their listed exposures.

A shift in sponsor strategy has been underway in the past year, with larger players now being judged more broadly on returning capital to LPs rather than price maximisation at exit.

This has prompted sponsors to scale up sales of already listed holdings. Year-to-date, there have been USD 16bn of private equity sell-downs through follow-on transactions – the highest deal value for any year since 2017.

Source: Dealogic

While there have been fewer sponsor sell-downs than last year – 38 in 2025 vs 45 in 2024 – deal sizes have been larger, demonstrating appetite to shed larger holdings.

Last week, EQT returned to the market with a SEK 3.1bn (USD 328m) sell-down in Swedish refrigeration and air conditioning company Beijer Re, its third sale in the name in three years. It listed the business in 2020.

The Swedish sponsor has regularly tapped follow-on markets this year, completing five sell-downs worth around USD 3.9bn.

Its pragmatism in execution has been praised, particularly in relation to its three sell-downs in Swiss skincare conglomerate Galderma this year. Having listed Galderma in 2024, EQT has been willing to undertake sell-downs this year at times when markets seemed unfavourable, given volatility spikes.

It has also been proactive in making sure pricing is attractive for investors.

At its last Galderma block trade at the end of July, the sponsor left money on the table to help the stock price post-deal and keep the market warm for future disposals.

An investor said at the time of the last deal, it had been a recipe that worked, with EQT able to sell-down its Galderma stake at a higher price each time it has come to market.

It will likely also pay off the next time the Swedish sponsor returns to market – Galderma’s shares were around 14% above the price of the last deal at the end of last week.

EQT is locked-up on selling any more of its Galderma stake until 29 October, however, lock-ups on its Galderma stake have been waived early before several of its last sales.

Source: Dealogic

Several candidates for block trades

EQT is far from the only private equity name actively selling stock in the European equity capital markets and investors expect to be busy with European block trades as soon as this month.

“We are currently running through all the situations we expect sponsors to start to bring from the beginning of September,” said one.

Dealogic predictive analytics highlights a sell-down in Polish e-tailer Allegro, with shares held by Permira, Cinven, as a highly likely deal.

The analytics also highlight Paris-listed amplification, detection and imaging technology player Exosens, owned by Groupe HLD, as another sell-down candidate, continuing the theme of investors buying into European defence-linked stocks. Also in focus is Madrid-listed online travel operator eDreams, where Permira also has a stake. Alongside these deals, Advent is approaching the end of its lock-up on its stake in Amsterdam-listed locker company InPost, with the share price just below previous sale levels.

In addition, the investor noted that there are several other equities where sponsors have been expected to sell more stock but have not yet.

One interesting situation for investors might be CVC’s 47% holding in Recordati, which is indirectly held by the sponsor’s 2017-vintage VII fund.

Following a 5% stake sale in February, CVC exited a lock-up on its holding in May but has not moved to dispose of any more of its stock, which had previously been subject to M&A speculation.

The stock is trading around 4.6% below the offer price of the last block. But with a market cap of just above EUR 11bn, the business is trading at an 87% premium to the EUR 5.86bn valuation when CVC bought its stake in 2018.

CVC did not respond to requests for comment on its strategy for its Recordati holdings.

In good times and bad

The reason sponsors have pivoted more to block trades in 2025 is that once a stock is listed, an equity sell-down is a simple capital markets transaction for banks to undertake, even in times of heightened market risk, with just one or two green market days required to execute a deal.

The only impediment is on the issuer side, with some sponsors still occasionally waiting too long and missing a window in the hope of securing a better price.

However, this attitude is shifting.

Several bankers have noted that there is a growing admiration for the strategy employed by EQT over Galderma disposals and the consortium behind Allegro, pushing ahead with blocks even at times when markets were far from ideal.

“The European market this year has been very much bifurcated – IPOs are very tough with volatility, but ABBs [accelerated bookbuilds] have shown a remarkable resilience against macroeconomic and geopolitical shocks,” said an ECM banker.

Even if markets turn again, sponsors seem increasingly relaxed about placing sizeable blocks amid heightened volatility.