Private equity (PE) groups have amassed a fortune in dry powder, cash reserves meant to purchase assets in the future, and have buoyed the market despite slowing deal volume. According to Pitchbook, PE groups currently have $545.5 billion in dry powder and have increasingly used it to make acquisitions. PE deal volume is 17% higher than it was this time last year and is on pace to reach the record levels of 2015 and 2014. The positive effect of PE activity has helped to boost valuations to reach an average of 9.4x EBITDA, even as overall middle market deal volume decreased by 12%.
David Micheals, Capstone Managing Director and head of the technology & telecom group, highlights the top M&A factors and the primary drivers for 2017.