Q1 Buyout Deal Drop

Buyouts Magazine today made official what we’ve all known for a while: Q1 deal volume hit the skids.

U.S. buyout firms last quarter closed just 226 “control” deals, and the 53 with disclosed values were worth just $46.1 billion. For context, 283 deals were completed in Q1 2007, with $103 billion in disclosed values. 

But the real slowdown is in the pipeline, with just 163 control deals announced last quarter. That’s down 33.2% from the 244 deals announced in Q1 2007, with disclosed values dropping from $47.2 billion to just $15.6 billion.

So what types of deals are still getting done? Ironically, it was often companies reliant on discretionary spending (those refund checks will come in handy). Sixty-eight of the quarter’s closed deals are in the consumer staple, retail or consumer product/services spaces. Also hot were industrials and media/entertainment.

Buyout firms also spent a lot of time building up exiosting portfolio companies, with more than 40% of the closed deals described as “bolt-on” transactions. That figure was just around 20% a year ago.