Manufacturing has recovered strongly since the Great Recession and is likely to retain a key position in the U.S. economy, according to participants at the Association for Corporate Growth’s InterGrowth conference this week in San Diego.
This perspective should be reassuring for financial sponsors, who historically have favored sectors such as manufacturing, with its hard assets and generally reliable, if often unglamorous, financial performance.
While the sector should continue to be a mainstay of the economy, its prospects are likely to be driven more by technological investments and automation, even as its role as a job creator continues to decline.
Altus Capital Partners, a boutique buyout shop in Westport, Conn., looks for target companies that have a proprietary technology or process that can drive their growth, said Elizabeth Burgess, a senior partner at the firm, during a panel discussion on manufacturing. But the firm also must analyze the cost of maintaining the competitive edge of its portfolio companies, she said.