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Refi Activity Helps Drive Lending to PE-Backed Firms to Record Heights

December 05, 2017, 08:00 AM
Filed Under: Industry News

Lending to U.S. private equity-owned companies hit a record high in November, with the bulk of the surge in new capital attributed to increased refinancing and repricing activity, according to Thomson Reuters LPC data.

Refi and repricing deals accounted for 81% of a record $588 billion that was delivered to U.S.-based private equity-owned firms during the month, the analysts reported.

According to the data, buyout loans were also a strong contributing factor to the growth, totaling $111.3 billion -- the third-largest amount on record.  The last time such a high level of acquisition financing was funneled to private equity backed companies was in 2007, Thomson Reuters noted, when it broke $200 billion in a single month. A lending frenzy in the middle market was singled out as a factor in the increased volume.

“Buyout activity has been boosted by activity in the middle market space," Reuters Noted. "Volume has risen to S$24 billion this year, the highest figure since 2007 when middle market buyout volume totaled almost $30 billion."

To read the report in its entirety click here

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