Private equity in focus
The buoyancy in the buyout sector towards the end of the year reflected the broader M&A market. After a slow start to the year, the value of deals surged in the second half despite a dip in transaction volume. Some US$122.68 billion worth of deals were sealed in H2, up almost US$40 billion on the second half of 2014, yet down 15 percent on a volume basis over the same period.
This rise in value coupled with a fall in volume was a hallmark of M&A in 2015, and the private equity sector has been no exception. Funds have plenty of money—US$1.3 trillion on a global basis, according to research firm Preqin—that they are looking to invest; and this has made conditions perfect for sellers in recent years, but more challenging for buyers.
“Private equity firms have a lot of funds to deploy. Vendors and strategics know this, and bankers are marketing bigger deals because they know that these firms have the appetite and assets to do deals,” says White & Case partner Oliver Brahmst.
Indeed, the competitive tension caused by the abundance of capital appears to be creating a disconnect between overall deal value and volume.
2015 surpasses 2014 in terms of buyout value Buyout volume falls Buyout value surges in Q3 Exit value and volume down compared to 2014 Industrials and chemicals is the top buyout sector for private equity volume Technology is the top buyout sector for private equity by value
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