GCG’s Q2 2022 Middle Market Private Equity Update provides an overview of the latest trends in the private equity market.
Key findings include the following:
- Deal values for the first half of 2022 are down 18% from 2021 on an annualized basis, however 2021 was a record setting M&A year and 2022 is still very strong from a middle-market M&A perspective. Deal values for the first half of 2022 are up 14 – 15% from the 2018-2020 years.
- 2022 deal activity is facing more headwinds than 2021 as rates are increasing, inflation is accelerating, and supply chain continues to haunt many industries. That said, the deal activity remains vibrant.
- Deal volumes for the first half of 2022 on an annualized basis dropped approximately 7.3 percent from 2021 volumes, but the number of deals had a smaller percentage drop than the value of deals. This signals that more deals are getting done at the lower part of the middle market vs the upper end.
- Private equity continues to increase its uninvested capital raised. It finished 2021 at record levels and continues to raise funds at a strong pace. This is the basis for our belief that 2022 to 2026 will be an extremely hot M&A market led by private equity.
- The first half of 2022 saw $176 billion raised by private equity. On an annualized basis, this will set a new record. The previous high year of raised capital was 2019; 2022 is on pace to exceed this by 8 percent.
Click here for the full update.