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Alternative Market Briefing

Private equity muddles through Q2

Monday, July 31, 2023

Bailey McCann, Opalesque New York:

Private equity saw a mini-rebound in the second quarter according to new data from PitchBook.

Private equity saw two significant exits in the second quarter Adenza for $10.5 billion and Apptio for $4.6 billion. As well as two listings - the $2.9 billion IPO of Savers Value Village and the $1.2 billion IPO of Kodiak Gas Services. All four transactions provided encouragement to an otherwise lagging exit environment, total exit value grew by 66.9% from last quarter, according to PitchBook data.

The rest of private equity's data for the quarter is mixed. Deal count increased, but deal value is still down 15.8% from Q1. Deals still favor smaller bolt-on transactions, which are easier to finance as the leverage market remains tight and expensive. PitchBook reports that more GPs are turning to NAV financing to get deals done alongside existing credit facilities.

Private equity is also leaning on take private deals - albeit smaller ones. Firms are looking at middle-market companies in this vein. PitchBook says a total "of 43 take-privates have been announced or completed so far in 2023, identical to last year, which went on to record the highest take-private deal value in 15 years."

The median deal size of 2023's crop is $482.9 million, which compares with a median of $1.7 billion during the same span last year, dropping the combined value of take-private deals to $88.9 billion YTD versus $147.2 billion YTD in 2022, PitchB......................

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