Q1 2021 Middle Market Private Equity Update

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GCG’s Q1 2021 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. 2021 deal activity through Q1 is down approximately 10% on an annualized basis.
    • Capital overhang, which represents the amount of capital raised by PE funds that has not yet been invested, stands at the largest level it has ever been globally at over $1.45 trillion of unspent capital raised.  Most of this capital is in funds that are 0-2 years old. We believe 2022 to 2026 will be an extremely hot M&A market led by private equity.
    • EBITDA multiples in Q1 2021 continued their recent trend of fluctuating around 13.0x at 12.7x, a slight decrease from Q4 2020 and the same level as Q2 2019. Part of this can be explained by the lower EBITDA for many companies during COVID-19. Some transactions are getting done with and accepted add back for the one-time impact of COVID on the target business.

Click here for the full update.

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