Tough market ‘fantastic’ for private equity deals

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M&A is increasingly defined by higher borrowing costs and cheaper public company valuations, which has presented an opportunity for investment firms to pounce.

Deal makers discuss the environment for M&A amid increased borrowing costs.Erin Tinker, a founding partner at investment bank Barrenjoey, agreed the “pullback in big MA” in 2022 needed to be considered in perspective. “In terms of overall deal volumes, we’re looking about the same as normal for any year prior to 2021,” she said.

“We’re seeing high-quality businesses much cheaper than they were last year, which is fantastic,” Mr Chunara said. “That, of course, has to be balanced against the macroeconomic environment.”Another boon for private capital is that public debt and equity capital markets have become harder for companies to access as borrowing costs surge.

 

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