On December 16, 2025, the French Assemblée Nationale established a parliamentary commission of inquiry to investigate the impact of private equity on France’s productive capacities. So far, the commission has held nine hearings with unions, employers, private equity managers, industry representatives, journalists, and regulators. While the final report is due in mid-2026, the hearings have already revived a debate that has changed little since the late 2000s: lack of transparency, privatising gains while socialising losses, favouring short-termism etc.
France has become Europe’s premier market for LBOs. Since 2009, annual investment by French PE funds has grown from €4.1bn to €26bn. Between 2015 and 2024, France recorded 4,675 LBOs—far ahead of Germany (2,786) and Italy (1,749). French companies’ under-capitalisation and high debt make them vulnerable to acquisition, while the absence of large domestic pension or sovereign wealth funds leaves them reliant on foreign capital. Over 10,000 French companies, representing 13% of private sector employment, now operate under PE ownership, spanning nursing homes, clinics, infrastructure, and industry.
The inquiry revealed a sharp divide on the impact of private equity. Predatory or Patient Capital? Trade unions and investigative journalists depicted LBOs as fundamentally extractive. Distress funds were singled out for acquiring struggling subsidiaries for a symbolic euro, extracting remaining value, and leaving the national wage insurance scheme (AGS) to fund mass layoffs. Union witnesses reported job cuts even in profitable companies, underinvestment in R&D, and deteriorating working conditions.
Industry representatives countered that PE provides essential “patient capital,” citing the Draghi report’s estimate of €750–800bn annual investment needs for Europe’s digital and green transitions. They argued LBOs facilitate business succession and maintain independence, with French portfolio companies outperforming peers.
Several emblematic cases were raised at the hearings: Vivarte, Verallia, Kem One, NovAsco, LMB Aerospace. The healthcare sector emerged as a particular focus. Unions described PE funds acquiring profitable clinics via LBOs, then charging exorbitant rents to service debt, while lucrative medical treatments were prioritised over essential services.
Several speakers highlighted systemic weaknesses of the oversight and regulatory coverage. Some pointed to a flawed bankruptcy regime. French commercial courts are reportedly staffed by non-professional judges with business ties and usually favour distress fund bids over employee-led alternatives. Several also pointed to the national wage guarantee insurance scheme, AGS, for effectively subsidising private equity failures by covering layoffs. Both the AMF and the Banque de France acknowledged very partial coverage of private equity activities in France – overseeing only fund-investor relations, not fund-portfolio company interactions, lacking jurisdiction over foreign-domiciled funds operating in France via the EU passport. The Finance Ministry can impose conditions on foreign takeovers but often faces faits accomplis.
The inquiry documented extensive movement between senior public roles and the private equity industry. While industry representatives defended this as beneficial for regulatory dialogue, MPs questioned whether it creates privileged access and conflicts of interest, undermining effective oversight. So far, the commission’s hearings have exposed deep divisions over private equity’s role in France. Unions demand stronger worker rights, conditionality on state aid, and tighter LBO regulation. Industry warns against stigmatising a vital source of investment in the French context. With the final report due in mid-2026, the commission’s findings could shape significant legislative proposals.