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Private Debt Intelligence - 10/17/2016

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Private Debt: Funds in Market

Preqin’s quarterly update on the private debt industry finds that as of the beginning of Q4 2016, there are 304 funds in market targeting an aggregate $147bn globally. With few funds closing through the year to date, the marketplace has grown considerably since mid-year; there are 50 more vehicles on the road seeking an extra $6bn of investor commitments compared to the start of Q3.

Direct lending, once again, represents the largest proportion of private debt funds on the road, both by number (38%) and aggregate capital targeted (39%)...

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The Pulse of Private Equity - 10/17/2016

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Debt Usage in US M&A Remains Historically Low

Even as multiples remain stubbornly high across multiple sectors, debt usage remains low. This is primarily the result of a confluence of factors, including stricter regulations, cash-rich buyers and a general trend toward buying and building as a strategy on the part of private equity investors. In that last case, PE firms aren’t relying as much on financial engineering as they used to, looking instead to deploying more equity in deals to avoid overburdening portfolio companies with barely serviceable debt loads. Of course, that necessitates shrewd operational enhancements...

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Markit Recap – 10/10/2016

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The CDS market in September is typically dominated by one event: the semi-annual roll. The outperformance of single names observed during August was maintained in the run up to the roll on September 20, with the skew between the Markit iTraxx indices and their theoretical levels all but eliminated. However, it was business as usual…

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The Pulse of Private Equity - 10/10/2016

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Sustained High Multiples Contributing to Deal Values in the US Lower Middle Market In a recent Lead Left column, we observed that median enterprise value/EBITDA buyout multiples for businesses with EVs of under $25 million were quite high, at 6.13x in 2Q 2016. Coupling that with yearly deal flow figures for the US lower middle…

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Private Debt Intelligence - 10/10/2016

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Private Debt Fundraising Remains Low in Q3 2016 Preqin’s Q3 update on the private debt fundraising market finds that the quarter marked a further slowdown in the levels of capital secured by managers in the space, as 2016 continues to see a far reduced rate in fundraising activity from recent years…. Subscribe to Read MoreAlready

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Markit Recap – 10/3/2016

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Numerous press articles in recent years have predicted the death of single name CDS. Onerous capital requirements, costly changes in market structure and alternative hedging tools have all been cited as factors driving the inexorable decline in the product. No one could deny that CDS activity has dropped sharply from its pre-crisis heyday. But the…

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The Pulse of Private Equity - 10/3/2016

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Familiarity Breeds Debt Usage Based on PitchBook and aggregated survey data, average debt levels in the second quarter of 2016 were much higher for transactions with smaller companies than they were for their larger counterparts. In fact, businesses with enterprise values of up to $25 million averaged 53% in… Subscribe to Read MoreAlready a member?

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Private Debt Intelligence - 10/03/2016

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Strategies Targeted by Private Debt Investors According to Preqin’s Investor Outlook: Alternative Assets, H2 2016, 56% of investors with an active mandate in private debt are seeking to make at least one direct lending commitment within the next 12 months, the largest proportion among strategies in the asset class…. Subscribe to Read MoreAlready a member?

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