PE moves further into IT, software View PitchBook’s 1Q 2017 US PE Breakdown Report Here Thoma Bravo, Vista Equity Partners and Silver Lake used to be the paramount examples of the few notable PE firms making primarily tech and/or software plays. However, overall investment within the IT industry has grown significantly over the past several…
Private Debt Dry Powder by Geographic Focus While fundraising has been strong in recent years, private debt managers are managing to deploy capital at a similar rate to securing commitments from investors. As such, the level of dry powder has remained relatively constant in recent years, but has risen notably since the end of 2012….
CLO issuance is on track to meet or exceed market forecast in 2017 One third of loan arrangers, CLO arrangers and managers surveyed by Thomson Reuters LPC expect CLO issuance could reach or exceed $70bn this year. But challenges remain including a lack of new issue supply and complying with risk retention. Amidst the ongoing…
Private Debt Fundraising in Q1 2017 by Fund Type
The private debt industry recorded a strong start to 2017, as 21 vehicles reached a final close attracting $21bn in investor capital, despite marking a downturn from the record $50bn raised in Q4 2016. However not all strategies were able to capitalise on healthy investor appetite and attract high levels of commitments.
Direct lending funds in particular drove fundraising, securing their highest quarterly total of all time...
Some LPs still keen on co-investment
In 2016, limited partners participated in no fewer than 76 US private equity transactions, the cumulative value of which hit no less than $33.8 billion, more than any other year in the past decade excepting 2007. Moreover, 2017 is off to a strong start in terms of value at least, with $9.8 billion tallied thus far across a slower-paced 13 deals. The steady upward trend since 2010 is unmistakable if volatile...
Cross border financings gain momentum as thin EMEA pricing attracts leveraged issuers
In a turn around from 2012-2013 market trends whereby European issuers tapped the US loan market in a bid to lock in thinner margins, a number of US leveraged issuers have turned to the European market early in 2017, to secure thinly priced deals. In contrast to the rising interest rate environment in the US, the European market is expected to keep interest rates low in the near term...
Q1 2017 Private Debt Fundraising
After a sluggish start to 2016, private debt fundraising saw a huge acceleration in pace over the year, and secured a record $50bn of investor capital in the final quarter of the year. While the opening quarter of 2017 failed to match this activity, momentum has nonetheless continued into the year with fundraising expected to maintain or increase this pace in the coming months...
Is the PE industry on pace for lower net cash flows?
Since 2012, net cash flows of private equity funds worldwide have been positive, with the last three full years handily exceeding $130 billion apiece. With fund returns through the middle of 2016, however, net cash flows currently stand at $27.0 billion, putting the back half of 2016 under considerable stress to even leave the year at more than $100 billion. This diminishing metric is attributable to a variety of factors, including the slow winding down of the buyout cycle in addition to a sluggish exit market...
Many names have a certain kind of notoriety in the CDS market. TXU, Hellenic Republic and more recently iHeart – all posed significant challenges to the efficacy of the CDS product.
Another prime example is Novo Banco. The Portuguese name was created as a "good bank" in the restructuring of Banco Espirito Santo in August 2014. This was immediately prior to the introduction of the ISDA 2014 definitions in September of that year. The good bank/bad bank split highlighted some of the flaws in the 2003 definitions: namely senior debt restructurings triggering subordinated CDS and ambiguity around state bail-out of financials...
1Q17 M&A volume down 32% year over year as market waits on policy guidance out of Washington
M&A loan issuance declined dramatically year over year to log less than US$70Bn in 1Q17, down 32% compared to the year ago results (US$102Bn). This represented the lowest quarterly results since 1Q13. Although some of the market shortfall on a percentage basis should be qualified in that jumbo financings for Avago Technology and Kraton Polymers which were completed in 1Q16 were in fact structured in 2015, the market took a very real pause in 1Q17 as issuers waited on the new administration in Washington...