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February 21, 2020 No Comments Author: Andy Jones

Private Equity Investments in Physical Therapy Companies

Private equity firms have made a number of investments in companies offering physical therapy services, including: general rehabilitation services, occupational therapy, sports injury recovery, orthopedic rehabilitation and pediatric therapy. Our Private Equity Database currently tracks 43 U.S. based physical therapy companies held by private equity firms.

February 15, 2020 No Comments Author: Andy Jones

Private Equity Investing in Security Companies

The security industry overall has attracted significant attention from private equity investors in recent years. Private equity investments into security-related companies ranges from cybersecurity, home security, national security, private security, to security screening of goods crossing borders.

Our private equity database currently tracks 719 current platform portfolio companies with some element of security to their product or service offering. 73 of these investments were made in the last 12 months alone.

February 08, 2020 No Comments Author: Andy Jones

Private Equity Investing in Gluten-Free Companies

Gluten-free food has been a significant trend for the past decade, especially the last few years. Consequently, select private equity firms have made investments in companies that offer an assortment of gluten-free food.

Our research database shows 52 investments in gluten-free brands (collectively held by 42 unique private equity firms). Of these, 36 are current holdings, 16 prior investments. 2017 had the most investments of any year thus far with 9 gluten-free portfolio investments. By comparison, there were 6 in 2018 and 3 in 2019.

January 29, 2020 No Comments Author: Andy Jones

Private Equity Investments in Manufacturing Companies

Headlines about private equity investments tend to focus more on the glamorous deals and faster-paced industries, particularly technology. Because of this, one might erroneously conclude private equity has curtailed investments in manufacturing companies. While it is true that manufacturing now represents a lower percentage of all private equity acquisitions compared to historical standards, PE firms still actively invest in the manufacturing sector.

In the last 60 days, our M&A Research Database has recorded 52 new private equity platform investments in manufacturing companies (there are even more add-on acquisitions in this space), of which pharmaceutical manufacturing was the most represented manufacturing category:

  • Pharmaceutical manufacturing (5 investments)
  • Automotive-related manufacturing (4 investments)
  • Contract manufacturers (4 investments)
  • Aerospace manufacturing (2 investments)
  • Lighting manufacturers (2 investments)
December 11, 2019 No Comments Author: Andy Jones

Schwab Acquisition of Ameritrade

Charles Schwab recently announced plans to acquire Ameritrade for $26 billion. The combined entity will have 24 million customer accounts holding ~$5 trillion assets.

While most people are familiar with Charles Schwab and Ameritrade for their enormous retail brokerage businesses, most do not know these firms also offer prime brokerage and custodial services to institutional investment funds.

Our research database tracks 53,711 institutional investment funds (hedge funds, private equity funds, venture capital funds, real estate funds, etc.). These funds often use third-party providers as prime brokers and custodians.

This data study reports on the prime brokerage and custodial services offered by Schwab and Ameritrade.

November 25, 2019 3 Comments Author: Andy Jones

Private Equity Investing in Senior Care

As a generational segment, Baby Boomers (now 55 – 75 years old), have a significant impact on the demographics of the U.S. population and on the markets that serve them.

US Population by Age_2019_11_21_1333

As this population segment ages, there is an expected increased demand for elderly care and related services. According to Morningstar, the average age of admittance into a nursing home is 79. With the oldest baby boomers currently at 75 years, coupled with a ~5-year median holding period for private equity portfolio companies, I thought we should see an increased investment appetite for elderly care operators and related service providers from private equity firms. As it turns out, we do.

September 24, 2019 4 Comments Author: Andy Jones

Private Equity Portfolio Company Holding Periods – Updated

I periodically update the private equity portfolio company holding periods data study to track this trend over time.

The longest median holding period for private equity owned portfolio companies was 5.6 years, back in 2014. This is intuitive because 5 or 6 years prior to 2014 represented those portfolio companies acquired at the peak of the market, just before the last recession. Consequently, the holding periods were extended, allowing more time to recoup from ill-timed acquisitions.

Since 2014, there has been a slight-but-steady downward trend in portfolio company holding durations – until now. The last data point on the right (2019 YTD, through August), represents the first trend reversal for this metric since 2014. Based on the last 5 years, I was expecting to report a median holding period of 4.6 years, but instead, the data shows:

2019 YTD Median Holding Period = 4.8 years

Private Equity Holding Periods