Skyline Advisors
  • Services
  • Team
  • Transactions
  • Industries
  • Reports
  • News
    • Capital Markets
    • Firm News
    • Resources
  • Contact
    • Newsletter

Partners for Strategic Transactions

First Quarter 2020 Private Equity Update

5/26/2020

 
Picture
In the first quarter (Q1), the global economy was brought to a halt as a result of the spread of coronavirus (COVID-19) and its ripple effects. Whereas general merger and acquisition (M&A) activity began to decrease in the first quarter (see M&A results here), private equity (PE) firms continued to make use of their record-high levels of dry powder. PE investments were up an estimated 6% by volume year over year in Q1, and valuation multiples were higher than the averages for each of the prior ten years (see page 7).

The second quarter is likely to have lower volume, as some deals that were in-process when coronavirus hit are either cancelled or delayed until Q3 or Q4. This is evident in preliminary transaction volumes in the second quarter (see page 4 of the report and our post on April activity). However, we expect the drop for PE deals to generally be less than the drop in general M&A and to rebound more quickly. We are seeing increased activity from PE firms actively reaching out to generate deal flow for new platform investments and add-on acquisitions for existing platforms – albeit with noticeable shifts in industries that are in and out of favor.
 
Despite a healthy number of acquisitions pursued by PE groups in Q1 2020, PE exits, or instances in which a private equity group exits an investment, fell an estimated 37.3% by volume year over year. This can be attributed to several factors, including public market volatility, travel restrictions, and a decline in expected exit valuation multiples for portfolio companies.
 
While activity levels are down, our experience is that private equity firms, particularly those flush with cash, are always opportunistically seeking quality deals. Contact us if you’d like more details on a specific industry.
 
A copy of the full report is available here.
Stay Informed...
  Thank you for Signing Up
  Please correct the marked field(s) below.
1,true,6,Contact Email,2

Comments are closed.

    Archives

    May 2022
    January 2022
    November 2021
    August 2021
    December 2020
    November 2020
    October 2020
    September 2020
    August 2020
    July 2020
    June 2020
    May 2020
    April 2020
    March 2020
    December 2019
    September 2019
    August 2019
    July 2019
    June 2019
    May 2019
    April 2019
    March 2019
    February 2019
    January 2019
    December 2018
    November 2018
    October 2018
    September 2018
    August 2018
    July 2018
    June 2018
    May 2018
    April 2018
    March 2018
    February 2018
    January 2018
    December 2017
    November 2017
    October 2017

    Categories

    All
    Auto Sales
    Bankruptcies
    Capital Markets
    Confidence
    Corporate Profits
    Debt
    Economy
    GDP
    Holiday
    Housing
    Industrial Production
    Inflation
    Initial Public Offerings
    Interest Rates
    Inventories
    Jobs
    Manufacturing
    Mergers And Acquisitions
    Middle Market
    Prices
    Private Equity
    Productivity
    Retail Spending
    Rural Economy
    Small Business
    Stock Market
    Taxes
    Trade
    Venture Capital
    Wages

    RSS Feed

Picture
​Skyline Advisors is a division of Ideation Ventures, Inc. Services involving securities are offered through M&A Securities Group, Inc.4151 N Mulberry Drive Suite 252, Kansas City, MO, 64116  (“MAS") . Services involving real estate brokerage are offered through Berkshire Hathaway HomeServices Ambassador Real Estate ("BHHS"). Skyline, MAS, and BHHS are separate entities. 
​

COPYRIGHT 2020. ALL RIGHTS RESERVED.
Virtual Data Room
Company   Services   Team   Transactions   Industries   Reports   News
Photo used under Creative Commons from inkknife_2000 (8.5 million views +)
  • Services
  • Team
  • Transactions
  • Industries
  • Reports
  • News
    • Capital Markets
    • Firm News
    • Resources
  • Contact
    • Newsletter