Private Equity News & Analysis

Private equity dominance grows

Around the world, financial sponsor-backed deals represented a significantly greater share of total M&A volume in 2006 than in previous years. The jump was especially remarkable in the US, where private equity deals were more than one fourth of total M&A.

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The year 2006 saw private equity sponsors grow in influence across the global mergers and acquisitions landscape.

Globally, financial sponsor-backed buyouts represented 18 percent of total M&A volume in 2006, year to date, according to statistics from Dealogic. This is up from 12 percent in 2005, 13 percent in 2004, 10 percent in 2003, 8 percent in 2002 and 4 percent in 2001.

Dealogic estimates that private equity firms and platform companies owned by private equity firms did $655.35 billion worth of deals in 2006 in 2,520 transactions. This is up from $349.17 billion in deals during 2005.

In the US, private equity activity nearly doubled as a proportion of overall M&A volume. Financial sponsor-backed activity represented 27 percent of overall deal volume in 2006, according to Dealogic. This is up from 14 percent in both 2005 and 2004, 11 percent in 2003, 10 percent in 2002 and 3 percent in 2001.

Private equity firms did $371.41 billion worth of deals in the US in 2006 year to date in 1,010 transactions, up from $163.2 billion worth of deals in 2005.