Non-Senior Debt Falling Out of Favor with PE Investors
June 18, 2014
Drawing from surveys of private equity dealmakers, as well as data from the PitchBook Platform, PitchBook has published its 2Q 2014 Deal Multiples and Trends Report. This report, sponsored by Toppan Vite New York and PNC Business Credit, offers a detailed picture of current deal structuring and investment multiples in the private equity industry. Deal-making is examined through several lenses, including EBITDA and revenue multiples, debt-to-equity ratios, closing times and fees.
Some key findings from the report include:
Debt levels sat at roughly 55% in 1Q 2013, down from 63% in 4Q 2013.
The median EBITDA multiple in 1Q 2014 was 7.2x.
The percentage of transactions that incorporate transaction and monitoring fees went up in 1Q 2014 after falling for the last two years.
Non-senior debt usage has fallen for two consecutive quarters, and is down significantly from 1Q 2012 levels.