There were 665 private equity-backed buyout deals announced globally in Q1 2013, valued at a total of USD87bn, a 112 per cent increase from the USD41bn in the same quarter last year, according to Preqin.
However, the number of deals fell from 770 in Q4 2012 to 665 in the first quarter of 2013.
Food and agriculture and IT were the most prominent areas of buyout activity in Q1 2013, with 38 per cent and 30 per cent of the aggregate deal value invested in these sectors respectively. This was driven by the two largest deals in the quarter, the USD24.4bn Silver Lake-backed privatization of Dell and the USD28bn Berkshire Hathaway and 3G Capital-backed buyout of HJ Heinz.
The two largest deals accounted for 60 per cent of the aggregate value of deals announced in Q1 2013 and are the largest private equity-backed transactions announced since the buyout boom era.
Some 82 per cent of the aggregate value and 56 per cent of the number of private equity-backed buyout deals occurred in North America.
European aggregate deal value in Q1 2013 stood at USD9bn, representing a decrease of 64 per cent on Q4 2012 levels.
Public-to-private transactions, although representing only six per cent of the number of private equity-backed deals in Q1 2013, accounted for 73 per cent of the total value of deals, which is largely due to the announced privatisations of Dell and HJ Heinz.
Some 40 per cent of all deals in Q1 2013 were leveraged buyouts, with 14 per cent of the aggregate value of global deals attributed to this investment type.
Two-thirds of all deals in Q1 2013 were valued at less than USD100m, and 80 per cent of deals fell into the small-cap bracket of less than USD250m.
A total of 290 private equity-backed exits were announced during Q1 2013, with an aggregate value of USD47bn, in comparison to 329 private equity-backed exits valued at USD77bn announced in Q4 2012.
“At USD87bn, the total value of buyout deals in Q1 2013 represented the strongest quarter for private equity-backed buyouts in terms of value in over five years,” says Anna Strumillo, manager – buyout and venture capital deals, Preqin. “The announcements of two mega-sized public-to-private transactions was the main contributor to the significant increase in the aggregate value of buyouts during the quarter. Nonetheless, it is worth noting that while deal activity was thriving in North America in the quarter, the value of buyouts in Europe was significantly lower than the levels seen in Q4 2012.”
