Europe beyond the headlines: where private capital sees opportunity now
Europe’s investment outlook is often framed around low growth, political uncertainty and structural challenges. Thomas Friedberger, Deputy CEO and Co-CIO at Tikehau Capital, sees a more nuanced picture. Speaking at SuperReturn Europe, he argued that the investment environment looks stronger beneath the headlines, but that the structure of growth itself is changing.
Key takeaways
- Look beyond extraction: Power, water, transport, logistics and processing can offer investment opportunities around Africa’s mining sector.
- Design for bankability: Credible demand, realistic downside scenarios and appropriate risk allocation must shape projects from the outset.
- Examine the commercial fundamentals: Contracted revenues alone do not remove customer, demand or commodity-cycle risk.
- Sequence investments carefully: Infrastructure serving existing users can generate revenue today while making future processing projects more competitive.
Europe looks better beneath the surface
Friedberger acknowledges the region's challenges.
Growth is subdued, and political uncertainty remains. But he also points to lower leverage and valuations than in North America, a stronger banking sector and fiscal expansion supporting areas such as defence and strategic infrastructure.
His conclusion: the investment environment is “not that bad” provided investors remain highly selective.
From consumer-led to capex-led growth
Friedberger’s bigger conviction is structural.
For decades, globalisation and falling interest rates helped support consumer-led growth. He believes the next phase will require far more investment in resilience and sovereignty.
Tikehau groups the opportunity around four themes:
Defence. Decarbonisation. Digitalisation. Deglobalisation.
These “4Ds” require significant capital expenditure, creating demand for capital from both governments and the private sector.
Value creation matters more
Friedberger also expects higher real interest rates to make multiple expansion harder to rely on.
For private markets, that could create greater dispersion between the strongest managers and the rest.
The differentiator becomes what an investor can contribute inside the portfolio company: expertise, networks, patient capital and operational support.
Europe’s opportunity may therefore come not from the disappearance of its challenges, but from the capital required to respond to them.
