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Deals and Exits Snapshot for May 2015


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Welcome to the first edition of CohnReznick’s monthly Deals and Exits Snapshot.

Middle market private equity transaction volume year to date has remained below last year’s levels and the trend continued in May with $5.2 billion of capital invested compared to $6.9 billion in May 2014. Even though the number of deals closed decreased in May 2015 when compared to May 2014 (172 in 2015; 217 in 2014), we attribute a considerable portion of the decrease in deal activity not necessarily to a lack of broader market activity, but to transactions taking a much longer time to close due to a variety of factors not limited to increased and more careful business due diligence and lengthy valuation negotiations.

While investment activity remains at a moderated pace, exit activity remains strong for many private equity firms. In the words of one private equity professional, “we are selling everything that is not nailed down.” With relatively cheap leverage available for quality transactions and increasing competition on most deals from strategic buyers, valuations continue to remain at high and potentially unsustainable levels creating a true sellers’ market.

For more information, please contact Jeremy Swan, a CohnReznick principal and the Firm's Private Equity and Venture Capital Industry Practice Leader, at jeremy.swan@cohnreznick.com or 646-625-5716.

We Value Your Feedback: We are eager to hear your feedback on this snapshot and what you would like to see in future editions. Email us with your comments and suggestions at cohnreznick@cohnreznick.com.

 


This has been prepared for information purposes and general guidance only and does not constitute professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is made as to the accuracy or completeness of the information contained in this publication, and CohnReznick LLP, its members, employees and agents accept no liability, and disclaim all responsibility, for the consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it.

 

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