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US PE Breakdown

Q3 2022

US PE Breakdown

October 11, 2022

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US PE deal value tops $819B through Q3 as industry reverts to the "old normal"

After a busy start to the year, US PE dealmakers are finally feeling the bite of higher interest rates, with activity in Q3 collectively slowing across M&A, growth equity and recap deals by more than 20% year-over-year.

Yet what may seem like a dramatic decline could also be considered a reset. Far from being a new normal, 2021’s blistering pace of activity was an aberration, making the “old normal” of the pre-pandemic years a better comparison for private equity, according to our Q3 2022 US PE Breakdown, sponsored by Stout and DealCloud.

Key takeaways:
  • Deal value topped $819 billion through Q3—equivalent to the second-highest annual total on record—as PE’s resilience and investors’ dry powder kept dealmaking on par with 2021 levels through July despite macroeconomic headwinds.
  • In the IT sector, investors closed 254 deals worth an aggregate $57.5 billion in Q3, in line with historical quarterly averages, as declining public market valuations spark buyers’ interest in high-growth companies.
  • For the first time in over a decade, take-privates surpassed $100 billion for the second consecutive year. In a major departure from the past, private debt funds have stepped in where banks left off to finance these deals. 
  • US PE fundraising totaled $259 billion through Q3, on pace with 2021, yet with many LPs having hit allocation targets for 2022, fundraising is expected to end the year with more of a thud than a bang.

Table of contents
Executive summary #
Deals #
A word from Stout #
Spotlight #
Exits #
Fundraising and performance #
A word from DealCloud #