Leveraged Loan Insight & Analysis – 11/8/2021

Equity multiples average an all-time high 7.1x on middle market LBO deals this year


US middle market LBO purchase price multiples have continued to move higher this year. Through the first nine months of the year, the average middle market LBO purchase price multiple was 12.1x, an all-time high, and 8% above last year’s previous record of 11.3x. Middle market company performance has been strong, keeping valuations at elevated levels.
With large amounts of dry powder to put to work, intense competition among private equity shops is driving up enterprise values. To make the math work, PE sponsors have been writing bigger checks.