Private equity investors have backed 662 U.S.- or Canada-based companies in the materials & resources industry since the beginning of 2007, according to the PitchBook Platform. Deal activity hit a four-year high in 2012 with 111 deals. The industry saw a healthy rebound from 2009 levels (up 44% from '09 to '12) but still has a ways to go to get back to 2007 levels (2012 deal activity was down 27% from 2007).
Sentiment was high last year for chemicals & gases, a sector of the industry. Deal activity for the sector jumped 40% between 2011 and 2012, though PE investment has tapered down by a quite bit this year, with less than half as many deals completed so far this year compared to 2012 levels. Instead, investors have turned their eyes to the metals, minerals & mining segment where 2013 deal activity has already eclipsed 2012's by over 20%.
Going back to 2010, PE-backed carveouts in the industry were at a low last year. PE firms have already made up the difference this year, almost doubling all of 2012's carveouts so far this year. In the U.S., the West Coast is a more popular destination for private equity firms this year than last year. Investments in West Coast-based materials & resources companies are already up 100% from 2012 levels.