Pitchbook released its 2017 Annual US PE Breakdown report this week. The total value of private equity (PE) deals completed in the US in 2017 was estimated at $538 billion across 4,053 deals.
This activity is down 8.9% from 2016, which is a bit counterintuitive at first since PE funds have record amounts of “dry powder” to invest. Three quarters of the follow-on funds raised by private equity funds during the year were larger than their predecessor funds. PitchBook’s recent 2018 Crystal Ball Survey report found that private equity firms had two main concerns. The first was a perceived “high-priced” environment, with the median EBITDA (earnings before interest taxes depreciation and amortization) in 2017 coming in at 10.5x. The second was a perceived lack of “quality” targets being on the market after the record volume of deals over the last several years.