Middle Market Weekly Outlook

Although emerging markets are still a risky bet for LPs and GPs, Africa seems to be attracting a growing influx of capital. Last week, CNBC reported, “PE funds invested $8.1 billion in African companies over 2014, the second highest total ever after the $8.3 billion in 2007.” Although the $8.1 billion pales in comparison to US-focused investments, the increase in Africa-focused funds and deals is not insignificant. Much of the focus has been on the telecommunications sector.

It remains to be seen if the dollars will continue to flow to Africa and other emerging markets in 2015. Bain’s recent Global Private Equity Report expressed doubt and suggested, “at a time when political, economic and social uncertainties are running high—as they are in most markets around the world today—PE investors are reflexively taking steps to reduce their risk exposure.”

Transactions:

• Valiant Capital invests in Mahindra First Choice
• Crestview Partners acquires JR Automation
• Black Dragon Capital acquires Enterworks
• AllOver Media sold to Audax Group
• SK Capital buys AEB Global
• LLR Partners invests in Agility Recovery
• MGT Capital Investments suspends merger discussions with Tera Group
• Heraeus to acquire NeoMetrics
• Harbour Group acquires Phillips & Temro Industries
• Bertram Capital invests in Sanbox Studio and OneKreate
• K2 Capital Partners raises fund targeting lower middle market
• Court Square buys Research Now
• Generation Partners sells Agility Recovery
• Armory Merchant Holdings invests in Capital Guardian
• Northwest Equity Partners invests in eyebobs
• Vector Capital buys Triton Digital

Opinions:

• Confidence in global M&A activity endures, but dealmakers are less bullish
• Many Blackstone M&A bankers expected to depart ahead of spin off to Taubman
• Insider traders and cement mergers
• Sorry, CFAs. An MBA will get that investment banking job you want
• US to examine leveraged loans more frequently
• Private equity secondary market is booming
• U.K. budget 2015 and private equity
• Can mergers between healthcare providers in different markets raise antitrust concerns?
• 6 mergers that ought to happen
• Institutions look to bypass infrastructure funds
• Are bankers taking the blame for private equity?
• Expect ‘trench warfare’ among investment banks
• Private equity pours money into self-storage deals
• A signal shows more oilfield mergers may be coming
• Private equity and US shale: Playing the long game
• These are tough times for private equity
• Chasing private equity returns
• Private equity should be a bigger source of local philanthropy

This week in history… Andrew Carnegie incorporates Carnegie Steel Company (1900).