Notable deal from Q4 2018

Indiana-based novelty sock retailer, For Bare Feet (dba FBF Originals), was acquired by Taglich Partners. Spell Capital Mezzanine Partners provided both subordinated debt and equity, and Texas Capital Bank provided financing, in support of the transaction. Metronome Partners acted as the sell-side intermediary.

Is there a mezzanine rebound?

While year over year mezzanine activity for the LTM period ending September 2018 slowed by 33.1%, the third quarter activity overall did increase by 46.2% when compared to Q2’18. For some time, the Mezzanine Market Perspective reported that mezzanine activity is declining, yet this may signal a rebound in activity. This is particularly true as firms look to non-bank lenders and other forms of financing to close deals in this competitive market.

Of the roughly 95 mezzanine backed transactions that traded in the third quarter of 2018, 35.8% were sponsor buyouts, and 21.1% were sponsor backed add-ons. As per the norm, the top three most active industries during this period were Services, IT, and Healthcare.

Feel the momentum in 2019

Buyouts is reporting this week that mezzanine fundraising in the US added $10 billion to the 2019 YTD totals, bringing total fundraising for 2019 to $13.5 billion. As fundraising continues its upward trajectory, how can mezzanine investors put this capital to good use? The SPS Portal is designed specifically with mezzanine and senior lenders in mind to support their business development initiatives with the right data. The Portal provides an interactive platform, including a mobile networking app, to maximize market coverage of relevant deal flow.

With the Portal, users can access comprehensive M&A Data, including difficult to source mezzanine transaction data, to query deals, PE firms, intermediaries, and professionals in a dynamic setting, customized for your target market. The SPS Alerts and Mobile App make it easy to reach out to new relevant deal sources, as well as follow up on your existing relationships in a timely manner.

While this is just the top-level functionality available to Mezzanine and Senior Lenders, The SPS Portal could help deploy your capital and take advantage of the current momentum. Find more information here, and learn how to improve your business development strategy.

Last week’s deals today

January 28 – February 1, 2019
~125 deals traded

Deal of the week

Last week, Sirius XM Radio Inc. completed its acquisition of the Oakland based Pandora, a cloud-based music platform. Centerview Partners, Liontree LLC, and Morgan Stanley all acted as sell-side advisors on the transactions.  
Most active subsectors
  • IT: Software & services
  • Industrial: Equipment & products
  • Financial: Services
Most active cities
  • New York
  • Houston
  • Washington

Photo by Peter Lewicki on Unsplash

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