This week we chat with Eric Green and Mark O’Keeffe of Muzinich and Co. Muzinich is a global institutional asset manager specializing in corporate credit; headquartered in New York, the firm has offices in London, Manchester, Paris, Frankfurt, Zurich, Milan and Madrid. The Lead Left: Gentlemen, what’s your take of what’s going on in private…
Transaction sizes suggest relative US middle-market popularity for PE
The median private equity transaction with a US middle-market company fell slightly to $134.0 million in 2016, down a mere $4 million from the prior year. Given the minuscule magnitude of the decline, it's clear that there is still plenty of competition from not only strategic acquirers in the upper end of the market but also fellow PE firms that are keeping transaction sizes relatively high, among other factors...
Private Debt Funds in Market by Strategy
After two consecutive years of private debt fundraising exceeding $90bn, the pipeline remains strong with investor appetite for the asset class as strong as ever. In total, there are 288 private debt vehicles marketing themselves to investors, targeting a combined $117bn of capital commitments.
Direct lending funds represent the highest proportion of both total funds on the road and aggregate target capital; 127 funds (44%) are seeking $51bn (43%)...
The volume for “new money” loans jumped last quarter (and last year) for both syndicated and privately clubbed middle market transactions.
Contact: Blake Udland Blake.Udland@spglobal.com
Many market commentators have commented that 2017 will be the year of political risk. Ongoing uncertainty around Brexit, Donald Trump’s inaugural year as US president and a series of elections in continental Europe make conditions ripe for bouts of volatility.
This may be self-evident, but so far the credit markets are taking little heed. Realised volatility in the Markit iTraxx Europe, as measured by the VolX index, dropped sharply in Q4 and has remained around the 28-29% level this year. Indeed, the last three months have been the longest period of low volatility since March 2007, when the first signs of the US sub-prime crisis emerged. It was a similar story with the Markit iTraxx Crossover...
Strong retail fund inflows help fuel the leveraged loan market
Investors have been pouring money into retail loan funds in recent months. This has helped fuel demand in the leveraged loan market. Last week, investors placed US$1.02bn into retail loan funds, the second time in three weeks the US$1bn mark was eclipsed. It was also the tenth week out of the last eleven that there was over US$500m invested in loan funds. With the increased demand in loans, it is no surprise the leveraged loan market has kept busy...
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If we learned one thing in 2016, it was that predictions of many sorts went awry. From national departures from economic unions, to presidential elections, to World Series champions, the unlikely became reality. With that in mind, we will offer in this series some thoughts on what’s to come this year in middle market lending,…