Steve Gelsi

Higher leverage ratios could provide cushion for BDCs Several BDC boards approved higher leverage limits Market constraints against using higher leverage Business development companies — engines of middle-market dealmaking — finally got Congress to approve higher leverage limits of 2:1, up from 1:1, capping a multiyear effort by the industry. Congress included the Small Business Credit Availability […]

Debt ratios for middle-market deals climb Demand from LPs for debt returns plays a role Volatility may signal change in cycle While market volatility in recent weeks may signal trouble ahead, for now the frenzy for both broadly syndicated and middle-market loans is expected to continue. A combination of cash-flush strategic buyers, rich valuations for […]

Fund VIII raised $672 mln Fund was returning 29.5 pct IRR as of Dec. 31, 2016 Firm exited four companies out of Fund VIII so far Quad-C Partners VIII LP, the vintage 2012 buyout fund from Quad-C Management, generated a net IRR of 29.5 percent as of Dec. 31, 2016, for Nevada Public Employees’ Retirement […]

One-fifth of LPs expect returns of less than 11 pct in next 3-5 years Four-fifths of LPs expect annual net returns of 11 pct and up from 2017-2022 Jitters around hard Brexit remain in the mix From July 2015 to the end of March, the Regents of the University of California’s private equity portfolio realized more […]

Targets industrial sector in the Rust Belt Acquired ship-repair business Paid single digit multiples; scaled up through add-ons While all sectors remain pricey nowadays, aerospace and defense has carved out a niche among richly priced buyouts. Interest in cybersecurity, drone development and geopolitical threats from North Korea and elsewhere have pushed purchase-price multiples up to […]

Firm offers Mercedes-Benz leases for tips on deals Uses M&A insurance instead of seller escrow from owners Doesn’t reset price from what’s in LOI When middle-market GPs want to avoid paying auction prices, they sometimes go into the wild to find deals. Hunting down target companies may be more challenging than diving into an expensive M&A process run […]

Endeavour Capital, the Portland, Oregon, buyout firm, has delivered strong returns on at least two of its funds. The vintage 2000 Endeavour Capital Fund III generated an IRR of 29.6 pct as of March 31, 2016, for Oregon Public Employees Retirement Fund, according to public documents. That compares with a top-quartile threshold of 17.1 percent for […]

Entrepreneurs, owners keep stakes after buyout Founders offered greater returns down the road CD&R and HGGC tout this approach Say you founded a viable industrial or software business and are thinking about selling it for a good price. You find an investment bank, hold an auction and cash out to a strategic or a buyout firm […]

Olympus Growth Fund V, the vintage 2007 fund from Olympus Partners of Stamford, Connecticut, generated an IRR of 19 percent as of June 30 for Regents of the University of California. The performance outpaces the 16.2 percent top-quartile threshold for that vintage year, an analysis of public-pension-fund data by Buyouts  shows. Rob Morris, managing partner and founder […]

Buy and build strategies remain in favor GPs lining up multiple add-ons Lack of quality platforms seen in 2017 With lofty purchase-price multiples persisting for the foreseeable future, GPs continue to pivot toward less-expensive add-ons as an alternative. Smaller companies not only cost less due to their relatively smaller revenue streams, they tend to trade at […]