Wilcox Investment Bankers Middle Market M&A Monthly

U.S. Lower Middle-Market M&A Remains Healthy

Wilcox Investment Bankers is pleased to share our U.S. Lower Middle-Market M&A Quarterly (June 2022). The report offers valuation and debt metrics and trends regarding M&A activity for U.S. lower middle-market deals (<$250 million).

The current economic headwinds (inflation, rising interest rates, supply chain issues, labor issues, war, COVID) seemed to slow deal volume in the 1st quarter of 2022 versus the abnormally active 4th quarter in 2021.

Countering these economic headwinds is the fact that both strategic buyers and private equity groups have substantial access to capital and continue to aggressively search for new opportunities.  Debt capital providers also remain active and supportive of deals (although they are curtailing leverage slightly).

In sum, U.S. lower middle-market M&A activity remains reasonably healthy, especially for above-average quality companies.  And valuations for the segments Wilcox Investment Bankers covers (manufacturing, distribution and business services), remain high.