GCG’s Q4 2020 Middle Market Private Equity Update provides an overview of latest trends in the private equity market.
Key findings include the following:
- Private equity middle-market deal activity was down in 2020 vs 2019. Deal volume was down approx. 16 percent and overall deal value down 19 percent during 2020.
- Most of the decline in deal activity was due to weak 2nd and 3rd quarters. The 4th quarter of 2020 was up significantly from the prior 2 quarters. The 4th quarter was down 5 percent from the 4th quarter of 2019 from a value of deals done and down less than 1 percent from a volume of deals perspective.
- Global private equity now has over $1.45 trillion of unspent capital raised. This is approximately twice as much as the amount available for investment at the end of 2015.
- EBITDA multiples during the 4th quarter of 2020 were at the 2nd highest point for any quarter since 2013. The average multiple, in excess of 14 times EBITDA, is more than likely skewed by the poor performance of many companies during the 2nd quarter of 2020 (due to COVID). That said, quality deals are getting premium during the 2nd quarter.
Click here for the full update.