The highest of hopes bogged down in an unrelenting swamp. That sums up the year in capital markets, as expectations of a rebound in deal making failed to eventuate. Yes, there was plenty of dry powder among the country’s largest private equity firms. And yes, the initial public offering market looks a little healthier after Guzman y Gomez’s $3 billion ASX float. But it’s tough out there.
Investor appetite is about to be tested with a slew of multibillion-dollar asset sales and auctions. London’s Livingbridge is hoping for a $1 billion payday when it. If investors step up and hit the bid on those valuations, there will be some real momentum in the market. If not, it will be the same painful conversation about dry powder next year.
Sarah Thompson has co-edited Street Talk since 2009, specialising in private equity, investment banking, M&A and equity capital markets stories. Prior to that, she spent 10 years in London as a markets and M&A reporter at Bloomberg and Dow Jones. Emma Rapaport is a co-editor of the Street Talk column. Prior to that, she was a markets reporter at The Australian Financial Review.