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Covenant-lite volume will likely hit another record high in 1Q17
Covenant-lite loan volume has already reached US$90 bn in 1Q17 with two more months still left to go this quarter. With another US$35bn still in process, 1Q17 will likely be a brand new record high for covenant-lite issuance. Covy-lite volume had just hit a brand new record high last quarter at US$128bn, smashing the previous record set in 1Q14. These robust volumes are largely taking place during big refinancing waves like in the current environment...
Will elevated US PE inventory contribute to continued secondary buyout activity?
It is difficult to get a sense of just how many middle-market companies there are in the US, which is a critical statistic to have on hand when analyzing the impact of the heightened private equity inventory. According to a recent installment of the Middle Market Power Index from American Express and Dun & Bradstreet, there were 182,578 firms that had between $10 million and $999 million in revenue in 2016...
Private Debt Investors Delighted with Fund Performance
At the end of 2016, Preqin conducted surveys with over 90 private debt investors in order to gauge their satisfaction with the performance of the private debt asset class and to ascertain their investment plans for both 2017 and long-term future.
More than a quarter (27%) of private debt investors surveyed stated that the performance had exceeded their expectations, an increase of nine percentage points compared to the end of 2015...
Overall LBO leverage on the rise in 1Q17
Average leverage levels on both large corporate and institutional middle market LBO deals have shown a meaningful jump in 1Q17. With refinancings and repricings dominating the leveraged loan market, investors seem more willing to stretch on new money LBO deals. The average leverage level so far in 1Q17 is at 5.0 times first lien and 6.50 times total debt to EBITDA, up from 4.6 times senior by 6.1 times total last quarter...
Review of Current Market Conditions/ Analysis of Capital Markets Metrics Including Covenants, Pricing, and Leverage/ Review of Credit Quality/ Outlook for First Quarter 2017
Beginning in September 2016 The Lead Left published a series of articles on sponsors. This report consolidates those articles. Enhancing Corporate Value/span> Working with Family-owned Companies Non-Sponsored Lending Revealed Non-traditional Sponsors
Review of Current Market Conditions/ Analysis of Capital Markets Metrics Including Covenants, Pricing, and Leverage/ Review of Credit Quality/ Outlook for Fourth Quarter 2016