Murray Devine’s Mark Emrich Published in Mergers & Acquisitions Journal
The middle and lower-middle market has long been considered an area where private equity investors could take advantage of an expansive target universe to find distinct value. Given that deals between $100 million and $500 million in size have traded at multiples exceeding 11x Ebitda, however, investors have been asking whether or not reason still prevails in these segments.
Murray Devine Managing Director Mark Emrich, earlier in September, published a bylined article in Mergers & Acquisitions Journal that explored this topic in more depth.
“Deal multiples in the middle and lower-middle market didn’t eclipse double digits in a vacuum and the pressures driving pricing have been well told over the past few years,” Emrich wrote. “More funds, more capital, readily available debt and, simply, a more efficient marketplace have each contributed to record valuations.”
The elevated valuations have presented new challenges for sponsors, however, particularly as multiple expansion can no longer be assumed as part of the return calculus. In addition to the catalysts driving prices higher, the piece also highlights, both, how behavioral factors may be influencing valuations and how the investment theses of sponsors have evolved to accommodate elevated prices.
The article can be found here (subscription required).
Mark leads business development for Murray Devine in the New York metropolitan market. Mark leverages his more than 20 year background in senior investment sales and the capital markets roles across multiple asset classes and strategies in both the public and private markets to grow Murray Devine’s New York business. Mark’s primary clients include alternative investment firms including private equity, private debt, hedge fund, and real estate funds in addition to banks, law firms, insurance companies and other financial intermediaries.