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May 12, 2022 No Comments Author: Andy Jones

Private Equity Investments in HVAC Companies

Private equity acquisitions of Heating, Ventilation & Air Conditioning (HVAC) companies have accelerated in recent years as PE firms employ an industry roll-up and consolidation strategy in this traditionally fragmented space.

Our M&A Research Database shows 673 historical PE investments in HVAC companies, including:

  • 379 platform acquisitions since 2010 (see graph below)
  • 55 platform acquisitions in 2021 alone.
Private Equity Investing in HVAC Companies

There are currently 233 active PE portfolio companies in the HVAC space (and 440 exits).

April 25, 2022 No Comments Author: Andy Jones

Top Industries of Stated Interest for PE Firms

The single best metric of a private equity firm’s appetite for a particular industry is the constitution of their portfolio – investments they have already made. For this, we produce a monthly PE Industry Trends report, based on completed private equity deals.

We also summarized the Top 10 Industries for PE Platform Investments in 2021, based on deals closed.

While Manufacturing & Distribution was the most sought after industry among PE firms (by stated industry of interest) in 2021, Software deals actually topped the list of completed deals.

March 17, 2022 No Comments Author: Andy Jones

Private Equity Investments in Construction Companies

Traditionally, Construction has not been a preferred industry of interest for private equity firms, precisely because it is often capital intensive and cyclical.

However, the Private Equity Info Research Database currently tracks 393 unique portfolio companies in the Construction space, collectively owned by 321 unique private equity firms. Clearly, there is now PE appetite in the construction space.

Top PE Firms Investing in the Construction Industry

The following PE firms hold at least 3 current platform investments in construction companies.

January 17, 2022 No Comments Author: Andy Jones

Private Equity Portfolio Aging

Portfolio company aging stats are dictated by past acquisition activity and exit rates over time.

As portfolio companies grow older in their respective funds, they age out, via an exit, often within 3 – 7 years. Portfolio companies in the 5 – 7 year vintage signal potential near-term transactions – deal flow – the lifeblood of investment banks, private equity firms, accountants, law firms, and a host of M&A service providers.

For U.S. portfolio companies owned by U.S.-based private equity firms, there are currently:

  • 1,225 portfolio companies currently aged (5 – 5.9 years)
  • 997 portfolio companies currently aged (6 – 6.9 years)
  • 776 portfolio companies currently aged (7 – 7.9 years)

As we previously reported, the median holding period for private equity portfolio companies industry wide is currently 4.9 years. Consequently, let’s look into the 5-year aging mark in more detail.

Turning Five

If we stand on the 5-year mark and look upstream at the parade of portfolio companies approaching their five-year anniversary in their respective funds, we’ll see the monthly aging flow shown in the graph below.

January 07, 2022 No Comments Author: Andy Jones

Top 10 Industries for PE Platform Investments in 2021

We reviewed all private equity platform investments in 2021 and ranked them by industry. The following Top 10 industries represent nearly half of all private equity platform acquisitions in 2021:

TOP 10 INDUSTRIES

  1. Software
  2. Manufacturing
  3. Healthcare
  4. Technology
  5. Food & Beverage
  6. Financial Services
  7. Digital
  8. Education
  9. Industrial Services
  10. E-Commerce

The chart below shows each of these industries as a percentage of the total PE platform acquisitions in 2021. Clearly, Software was the major industry of interest for private equity in 2021, representing17% of all platform acquisitions.

Top 10 Private Equity Industries of Interest in 2021