Strategic Insights

Knowledge is power

The deal sourcing community is fragmented.

PE firms see 18% of their target market deal flow, per SPS data cited in Bain & Company’s Global Private Equity Report 2017 Annual Report.

The DOBR is an annual industry standard comparing a Sponsor’s market coverage against all Sponsors and peer groups. These statistics provide detailed insight into a firm’s deal sourcing strategy and helps clients gauge their performance individually, as well as compared to the industry.

2018 DOBR

The results of the 8th annual SPS DOBR indicate that PE firms see a median of 17.2% of their target market deal flow.

The 2018 edition includes 138 qualified PE firms, segmented into 8 different peer groups, eg: Generalist, Quasi-Generalist, Sector Focused. These groups play a crucial role in contextualizing key takeaways, given the wide variety of deal sizes and industries that SPS clients invest in. This year is the first where over 50% of SPS clients have at least one dedicated BD professional, with top performers in all 8 peer group having one or more. The sell-side process metrics first introduced last year are here to stay, allowing PE firms unparalleled granularity into their coverage of limited processes versus broad auctions, along with how to improve it going forward.

2017 DOBR

According to the 7th annual SPS DOBR, PE firms see a median of 16.6% of their target market deal flow.

2016 DOBR

The results show that, on average, PE firms see 18% of their target market deal flow.

2015 DOBR

The results show that, on average, PE firms see 19% of their target market deal flow.

2014 DOBR

The results show that, on average, PE firms see 19% of their target market deal flow.

The perspective focuses on market trends and transaction in the mezzanine space and is released quarterly. It also provides data pertaining to transaction activity on a quarter-by-quarter basis going back to Q1 2012.

Q3 2018

The YoY decline in mezzanine transactions continued in Q2 of 2018. For the 12-month period ending June 2018, activity was down 41.6% from 560 to 327. When comparing Q2 2018 with Q2 2017 activity was down 50.4% from 119 to 59. Of the 59 completed mezzanine transactions in the second quarter, 69.5% involved a sponsor, compared to 76% last quarter. Overall, 7.6% of new platform equity investments in Q2 had a mezzanine component, compared to 13.4% in Q2 2017. For the second consecutive quarter, the Industrial sector was the most active industry followed by IT, Materials, and Consumer

Q2 2018

Patriot Capital provided mezzanine debt in support of Aterian Investment Partners’ acquisition of Vander-Bend Manufacturing.

Q1 2018

Five Points Capital supported Northlane Capital Partners’ acquisition of List Partners LLC with subordinated debt and equity.

Q4 2017

Gautier Steel Ltd, headquartered in Johnstown, PA, initiated its Employee Stock Ownership Plan (“ESOP”) buyout with $12M in subordinated debt provided by Mosaic Capital Partners. Gautier is a niche producer of steel products. The transaction was completed in November of 2017 and was intermediated by Signet Capital Advisors.

Q3 2017

In September of 2017, it was announced that Marquette Capital Partners provided mezzanine debt and equity for the recapitalization of Market Fresh Produce. Market Fresh Produce is based in Nixa, Missouri, and is a leading fresh produce company with a “Farm to Fork” strategy. C3 Capital Partners also provided equity and debt for this transaction.

The SPS Harvest Report is an annual customized report detailing all PE portfolio companies that may be ready for exit. It is a great resource to proactively target relevant companies that may be in a position to sell in the near term.

June 2018

The June 2018 Edition highlights 5,300+ PE portfolio companies that were acquired between 2011 – 2015 that are potentially ready to exit!

Harvest Report: June 2018 Edition Summary

Harvest Report: June 2017 Edition Activity Update

June 2017

Companies reviewed: 4,600+ PE portfolio
Originally acquired: 2010 – 2014

December 2016

Companies reviewed: 3,560+ PE portfolio
Originally acquired: 2010 – 2013

June 2016

Companies reviewed: 2,300+ PE portfolio
Originally acquired: 2011 – 2012

Our latest analysis, reports, and presentations on active intermediaries, deal sourcing, and mezzanine activity.

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