Global private equity and venture capital deal value is on the rise this year, even in the face of investor concerns about interest rates and a possible US recession.
In the year to July 31, global deal value amounted to $369.51 billion, a 26% increase from the same period in 2023, according to S&P Global Market Intelligence data. The number of deals during the measured period were down to 7,237 from the 7,657 reported a year earlier.
Deal momentum appears to be continuing into the third quarter, as the overall M&A market improves and private equity firms continue to spend record amounts of dry powder — capital raised but not yet invested.
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July deals increase
Transaction value in July was up 23.6% from the previous month.
Deal value in July alone stood at $59.26 billion, 32.7% higher than the same month in 2023 and about 44% higher than July 2022.
The largest transaction was Sixth Street Partners LLC's agreement to take reinsurance company Enstar Group Ltd. private for $5.1 billion. Liberty Strategic Capital and J.C. Flowers & Co. LLC are also participating in the acquisition.
The largest funding round was for China-based Fusion New Energy (Anhui) Co. Ltd., which raised $1.31 billion from CNPC Kunlun Capital Co. Ltd. and other investors.
US and Canadian deals made up more than half of the deal value in July at $36.31 billion, more than double the $14.22 billion posted for the same month in 2023.
European deals totaled $13.96 billion and Asia-Pacific transactions represented $7.57 billion.
Globally, the number of deals in July increased slightly by 2.9% annually to 1,067.
The technology, media and telecom sector had the most deal activity, with 380 private equity-backed transactions.
Within the sector, application software recorded the highest number of transactions at 173. Systems software followed with 38 deals, and IT consulting and other services with 29 deals.
H2 2024 outlook improves
Large US private equity firms are optimistic about the second half of 2024 even as fears of a US recession recently shook investors.
Management at The Carlyle Group Inc. expects private equity exit activity to shift higher in the back half of the year. KKR & Co. Inc. expects the global M&A and IPO deal market to rebound in the same time frame.