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Happy Friday and welcome to another edition of Axial Radar!
Private company valuations have remained quite high despite the reckoning taking place across the rest of the capital markets. Good news for strategic acquirers.
Strategics tend to flourish in inflated valuation environments – they’re able to move quicker than their financial counterparts and have shown a tendency to overpay in competitive bid processes. That age-old dynamic, however, is slowly beginning to change, and it’s in no small part due to add-on investments.
Accounting for nearly one fifth of all private equity deal volume over the last five years, add-ons are effectively transforming PE buyers into strategic acquirers. In this week’s feature Industry Trends article, we take a look at a report focused on trends in add-on investments. Based on a survey of more than 150 deal professionals, the report covers topics such as the objectives that are most important for buyers pursuing add-ons, valuation expectations, and the challenges of successfully executing add-ons. Scroll down to the bottom of the newsletter to access a free copy of the report.
Our featured buy-side members this week include a PE firm focused on the aerospace industry, a private investment firm backed by former business operators and owners, and a strategic in the metal finishing industry. On the sell-side we’ll introduce you to a leading Mexico-based financial advisory firm and an independent, middle market, private investment banking firm.
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