Capstone Partners Reports: Merger and Acquisition Activity Improves Year-over-Year In Q1 2021

Capstone Partners released our Q1 2021 Capital Markets Update reporting that total merger and acquisition (M&A) volume increased 2.9% year-over-year in Q1 as robust valuations and the prospect of tax increases have encouraged business owners to seek a liquidity event and capitalize on the current environment. Capstone anticipates rampant transaction volume through the remainder of the year with increased competition in deal processes to drive strong pricing for quality assets.

Also included in this report:

  • How Q1 transaction volume and aggregate deal value compares to historic levels
  • Data on average EBITDA purchase multiples for middle market M&A transactions
  • Which industries have experienced the highest valuations and transaction volume in the last twelve-month period
  • How have strategic acquirers altered their participation in M&A through Q1
  • Private equity middle market transaction activity and fundraising levels
  • Commentary on the availability and utilization of debt in M&A transactions

Taxes are pulling deals forward from 2022. The specter of increased capital gains taxes on high income individuals and families has undoubtedly prompted many owners, particularly those with a low basis, to rush for the exits in 2021.

Brendan BurkeManaging Director and Head of Sponsor Coverage, Capstone Partners

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