The trending private equity investment sectors for March 2021 were Software, Cybersecurity, Food & Beverage, and Health & Wellness. Sample transactions are highlighted below.
Private equity investments in apparel companies has declined in recent years, although this trend is not too dissimilar from PE investment trends overall.
The graph below shows private equity platform investments in Apparel companies over the past 5 years.
Food supplement businesses are attracting attention from private equity investors. PE firms have already made six platform investments in the supplement space in 2021.
In fact, our M&A Research Database shows 180 supplement businesses currently held as portfolio companies of private equity firms.
The “supplements” category represents a diverse range of businesses. The 180 private equity owned supplements companies include:
We last updated the median private equity portfolio company holding period in May 2020 because I wanted to mark this metric (mostly) before the effects of COVID. In May, the median holding period was 4.8 years, the lowest since 2014.
I revisited the holding period study again this month (November) to measure any changes since May. It ticked up, but only slightly, to 4.9 years.
At first glance, this may seem surprising that COVID-effects are not more profoundly seen in the data. But there’s a good reason for this. There haven’t been that many exits to move the needle on this metric. Private equity portfolio exits are down considerably compared to recent years.
With private equity firms holding portfolio companies through the COVID uncertainty, we will almost certainly see an increase in the median holding period going forward.
2020 YTD Median Holding Period = 4.9 years
Min = 3.0 years (early 2000’s) and 3.5 years (2008)
