Private equity-backed companies in Europe appear on firmer ground after data from Fitch Ratings showed default rates slowing in 2010 and predicted continued falls in 2011, paving the way for more exits.

According to Fitch, cost-saving measures implemented in 2009 and 2010, combined with economic recovery have bolstered leveraged companies. Defaults by value of debt fell to 5% in the 12 months to September 2010 compared with 5.7% in the first half of the year.