The agreed-upon deal is the latest encouraging sign for private equity in the materials & resources space—a sector that experienced a decline of more than 50% in deal activity from 2Q 2016 to 4Q, according to the PitchBook Platform. But even before accounting for a lag in reporting, 1Q 2017 brought a QoQ uptick—to 153 deals from 148 in 4Q—and the current quarter is on pace for a similarly healthy figure.
While Charter NEX is located in Milton, WI, the materials & resources sector is unique for its activity outside the US and Europe. Since the start of 2011, barely 50% of all such deals occurred in those two key geographies, according to PitchBook data, compared to nearly 80% of all PE transactions over the same timeframe. The biggest reason for the difference? Canada, home to 22.8% of all materials & resources PE deals versus a mere 5.7% of overall PE activity.