We've got private equity firms sitting on ~$2tn of committed, uncalled capital vs. firms struggling to sell existing investments, both brought on by a deal freeze related to high interest rates –?with buyout activity up, are we seeing a slow thawing of the deal freeze?
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Long sitting on $2.8 trillion, PE firms will likely see a surge in takeover activity and more pressure from investors to release cash, even if it means settling deals for lower pricing than anticipated. I sense robust dealmaking activity coming! Financial Times: https://lnkd.in/e_CnCUcE Arash Massoudi Anne-Sylvaine Chassany Antoine Gara #PrivateEquity #Investments #Dealmaking #MergersandAcquisitions
Private equity predicts deal rebound as sellers capitulate on prices
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Private equity executives are predicting a surge in takeover activity as buyout firms that have been holding onto investments in the hope of higher prices finally give in. The drop in private equity groups selling portfolio companies since 2021 has been attributed to rising interest rates and difficult financing conditions. However, investors are now pressuring these groups to sell long-held investments and start returning cash, leading to lower prices. Private equity firms are sitting on record amounts of capital but face a drying up of fundraising, creating urgency for asset sales. #PrivateEquity #TakeoverActivity #Investments #BuyoutFirms #AssetSales #FinancingDifficulties #CashReturns Source: Financial Times, ChatGPT https://lnkd.in/eQ2r94aw
Private equity predicts deal rebound as sellers capitulate on prices
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Overcoming the Towering Backlog Facing challenges in the private equity industry with significant dry powder, slow deal-making, and a portfolio of mature investments? PE firms are adopting strategic financing engineering tactics to overcome the backlog and ensure distributions: 1. Performance based earn-outs 2. Deferred payment from buyers 3. Large rollover investments from sellers Further, mega-cap buyout firms are excited about the carve-out transaction. To one’s surprise, the largest transaction was the GTCR’s carve-out of payments company wordplay in 2023. What exit mechanics would work in 2024? For more information, please refer to the link: https://lnkd.in/ggB9PrC2 #privateequity #privatecredit #advent #kkr #blackstone #rollover #strategies #exitstrategy
Private equity groups hunt for new exit strategies as cash piles up
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CEO Aster DM Healthcare - Digital Health | Investor and Board Director | Private Equity and Venture Capital | Advisor
"Private equity firms were sitting on a record $2.59tn in cash reserves available for buyouts and other investments." Quite a headline ending out 2023. "The private equity industry has entered 2024 with record amounts of unspent investor cash and an unprecedented stockpile of ageing deals that firms must sell in coming years." Sometimes it can be called a "refresh of capital"...but whatever you call it the firms will be chomping at the bit to deploy those reserves in 2024. Stay informed my friends. #PrivateEquityFirms #CashReserves #BuyoutsAndInvestments #RecordCashReserves #PrivateEquityIndustry #ceoinsights #InvestmentOpportunities #EquityNews #FinancialHeadlines #2023Outlook
Private equity groups hunt for new exit strategies as cash piles up
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CFO for enterprise SaaS | Strategic Operating Partner | PE and VC Advisor | Innovator of Sustainable Growth
Four of our largest US private capital groups (Ares, Apollo, Blackstone, and KKR) Deployed more than $160 billion in the latest quarter as they ramped up investment ahead of the expected revival in deal making in an environment of declining interest rates. Executives at the firm said they were readying for an increase in buyout and merger activity as the US Federal Reserve edges closer to cutting interest rates. Private equity firms (PEs) are sitting on more than $2 trillion of dry powder (capital that has been committed but not yet deployed in investments). There are now signs that the deal freeze is starting to thaw. Buyout activity is up 28% so far this year to $471 billion. This remains well below the boom years of 2021 and 2022. #pe #buyouts
Private capital groups deploy $160bn as they prepare for deal revival
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According to a recent Financial Times article, the recent surge in private capital deployment by giants like Ares Management Corporation, Apollo Global Management, Inc., Blackstone, and KKR signals a robust revival in the dealmaking landscape. With over $160bn invested last quarter, these firms are gearing up for a wave of buyouts and mergers as the Fed hints at easing interest rates. "The deal market is back," and private equity's $2tn dry powder is poised to fuel this momentum. #PrivateEquity #Dealmaking #InvestmentStrategy #Finance #EconomicOutlook #PrivateCapital ?? https://lnkd.in/eY9usyAJ For similar news stories and insights, subscribe to the FINTRX private wealth newsletter in the link below. https://lnkd.in/eWMHiUjX
Private capital groups deploy $160bn as they prepare for deal revival
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?? Private equity execs predict a surge in takeover activity as firms, sitting on a record $2.8tn in investments, finally sell holdings amid pressure to return cash to investors. ???? Find out more: https://lnkd.in/eVapfypm #PrivateEquity #InvestmentTrends
Private equity predicts deal rebound as sellers capitulate on prices
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With a record $2.59tn of unspent investor cash, PE firms are seeking ways to sell a backlog of aging deals while searching for new opportunities. Let’s put the dry powder to work in 2024! Financial Times: https://lnkd.in/eH-gmamn Antoine Gara Ivan Levingston William Louch #PrivateEquity #Investors #MergersandAcquisitions #Deals?
Private equity groups hunt for new exit strategies as cash piles up
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?? Private equity starts 2024 with a record $2.59 trillion in cash reserves, navigating challenges in sluggish IPO markets and a backlog of unsold investments. As major players hold a quarter of this sum, experts foresee a surge in deals, prompting strategic cash deployment. Exciting times ahead for private equity. The question that stems from this is how can private equity groups bridge the gap between what buyers will pay for a company and what owners will accept? https://lnkd.in/dhzbWCZz #PrivateEquity #Investments #DealMaking #FinancialEngineering #MarketTrends ??
Private equity groups hunt for new exit strategies as cash piles up
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Takeover activity to rise as buyout firms forced to sell Private equity executives anticipate a surge in takeover activity as firms holding on to investments anticipating higher prices yield to pressure from investors seeking cash returns. Rising interest rates and financing challenges have led to a decline in private equity portfolio company sales, creating a backlog of potential sales valued at $2.8 trillion, compelling firms to pragmatically accept lower valuations and boosting the prospects for asset sales between private equity groups.
Private equity predicts deal rebound as sellers capitulate on prices
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