Buy Side, Sell Side, Carve Out, Bolt On (blog)
PitchBook’s third quarter US PE M&A report released this month showed continued increases in dealmaking. Below are some notable highlights from the report:
- Cash rich strategic buyers with an additional windfall from the 2017 tax rate reduction continue pushing buyout multiples – YTD September 2018 at 11.9x EBITDA.
- Total deals closed YTD September 2018 were 3,501, a 2.1% increase over prior year.
- With multiples at elevated levels, the buy and build strategy of integrating add-ons at lower multiples continues to proliferate; add-ons represented nearly 2/3 of all closed deals YTD September 2018, an all-time high.
- Growth equity is a "growing" segment of PE, representing 13.2% of dollars raised in 2018, compared with 4.5% in 2017.
At CBIZ CMF, we are seeing similar dynamics in our Transaction Advisory practice, having completed 122 buy-side and 38 sell-side QofE engagements YTD September 2018. Furthermore, with elevated purchase price and execution risk inherent in most investments, our Financial Planning & Analysis (FP&A) team is seeing increased demand for Dashboard, KPI and Forecasting services.
Everything we see for 2019 points to continued optimism, despite the following potential headwinds:
- Rising interest rates
- Labor and crude oil driven inflation
To learn more about CBIZ CMF’s Transaction Advisory Services, please click here and FP&A Services, please click here.
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