: Private equity remains hopeful amid deal slowdown, M&A practitioners say

by | Jan 27, 2023 | Stock Market

Merger and acquisition practitioners from the world of private equity remain hopeful for a recovery in despite a slow start so far this year, after the usual flurry of deals failed to materialize in recent months. Alison Heyden Colby, assistant general counsel at Warburg Pincus, said some sales processes are underway with motivated corporate buyers looking at ways to boost growth from acquisitions.

But on the down side, many company owners either expect buyout prices based on better economic conditions, or they remain on the sidelines altogether. That leaves private equity firms on the hunt for acquisitions turning to proprietary deal flow from their own contact lists. “We’re trying to lean on relationships to drive deal flow,” Heyden Colby said. “Be careful not to be paralyzed by uncertainty. You could be sitting out a great year.” Private equity firms remain particularly sensitive to high interest rates since they base their investment returns on prices paid for a target and the cost of debt, she said. Private equity buyers have turned to smaller, less ri …

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