Deal and exit activity in the sub-$1B U.S. buyout market continued at an historically healthy pace, while valuations remained elevated and fundraising declined
This quarter’s edition compares and contrasts activity in the sub-$1B U.S. buyout fund market with the U.S. buyout market as a whole. While investment activity in H1 2018 in the sub-$1B buyout fund market declined marginally on an absolute basis, its decline was much milder than that experienced by the broader market. Exit activity in this sector of the market followed suit, declining marginally on an absolute basis and much less significantly than was experienced by the broader market. Despite these marginal declines, deal and exit activity continued at an historically healthy pace. This sector of the market continued to experience record valuations, albeit at multiples lower than the overall market. Meanwhile, fundraising at this end of the market declined markedly on both a relative and absolute basis.
This report also includes a discussion regarding the rise in representations and warranties insurance, including considerations prospective investors should be aware of before purchasing these increasingly important policies for their transactions.