Lost amid the flood of capital into the leveraged finance market – which has pushed clearing levels for both loans and high-yield bonds dramatically lower – is the fact that LBO activity picked up in January.
In all, private equity firms have inked $11.3 billion of new transactions during the month, up from $6.9 billion in December. Likewise, LBO-related loan volume has reached $7 billion month-to-date, up from $3.8 billion in December.
The quick start to 2013 for LBOs – not to mention talk of huge deals, such as Dell – has market players increasingly optimistic that LBO activity will trend higher in the months ahead, making 2013 a more fruitful year for deal-making than 2012, when LBO volume sagged to $98 billion, from $111 billion in 2011.
This analysis is taken from an LCD News story, LBO activity jumps in January, potentially auguring fruitful year, available to subscribers. It details
- Number of ‘jumbo’ LBOs
- Annual LBO volume
- Yield to maturity of leveraged loans
- Cost of funds for LBOs
- Average LBO leverage
- Debt/EBITDA for highest-leveraged LBOs
- Average equity contribution, LBOs
That story also includes an awesome spreadsheet detailing market stats/tone re LBO deals since 2001 (spoiler: 2009 was “ice-cold”).