Private equity investment in construction, engineering sector plunges

Global private equity and venture capital investment in the construction and engineering sector totaled $1.77 billion for the year to Sept. 17, less than a quarter of the $7.41 billion total for full year 2022.

The number of transactions in the measured period was 129, compared to 252 in full year 2022, according to S&P Global Market Intelligence data.

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In the second quarter, investment in the sector spiked to $1.29 billion, largely because of one deal: a roughly $828 million funding round for China-based CCCC Urban Investment Holding Co. Ltd. However, the aggregate value dropped to $280 million in the third quarter through Sept. 17.

Asia-Pacific has pulled in the most capital in the sector globally so far in 2023, with 16 deals totaling $855.8 million. It was followed by Europe with $741.9 million across 54 deals.

Top-dollar transactions

The $828.2 million round of funding for CCCC Urban Investment Holding marks the biggest transaction of the year as of Sept. 17. Chinese private equity firm ICBC Financial Asset Investment Co. Ltd. agreed to invest in the infrastructure construction business, alongside China Life Asset Management Co. Ltd. and China Communications Construction Co. Ltd.

For the second largest deal, eCAPITAL entrepreneurial Partners AG, G2VP LLC, Porsche Ventures GmbH and Franz Haniel & Cie. GmbH invested $234 million in 1komma5° GmbH. The Hamburg, Germany-based company provides services related to solar, electricity storage and charging infrastructure.