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| In today's Daily Pitch, you'll find: | | | | | |
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| Towering cash piles encourage global M&A growth | | Between PE sponsors and corporations, trillions of dollars of dry powder and cash on hand—near all-time highs—are primed for spending on M&A. Ready capital has kept the M&A deal count close to last year's levels, while the value of those deals is falling much faster.
Our Q2 2023 Global M&A Report, sponsored by Liberty GTS and RBC Capital Markets, explains the tug-of-war between the dry powder and cash reserves ready to strike M&A deals and the interest rates making them expensive, with deal multiples broken down by region and sector. | | | | | | | | | PE breaks its exits slump, raising rebound hopes | |  | | (patpitchaya/Getty Images) | | | Private equity's paltry flow of exits sprang to life at midyear, ending a yearlong decline and setting up the chance for a rebound.
Exit value totaled $87.3 billion in Q2, a 67% jump from the previous quarter and the first sequential quarterly rise in value in 12 months. Four late-arriving deals were key to the bounce in deal value. | | | | | | | |
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| Life sciences VC activity has slowed, but innovation continues | | Life sciences VCs are still trying to find their footing in the current market landscape. Quarterly deal flow has slowed to pre-pandemic levels, and median deal sizes continue to decline for most stages. There are some bright spots, however, including an uptick in total deal value between Q1 and Q2 of 2023 and rising pre-money valuations for early-stage companies. Orrick's Life Sciences Snapshot provides additional detail surrounding the industry's VC ecosystem, including a roundtable discussion of AI's role in drug discovery.
Read it now | | | | | | | |
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| Tech's new recipe: Generative AI serves up optimism for public foodtechs | | The performance of foodtech stocks kept up with the wider market in Q2, but no segment stood out above the crowd. Generative AI adoption bumped some companies to new heights, and the technology has settled into several niches across the sector.
Our Q2 2023 Foodtech Public Comp Sheet and Valuation Guide tracks stock performance, valuations and market caps—as well as forecasts for revenue, EBITDA and earnings per share—for key publicly traded companies. It touches on sectors including kitchentech, meal kits, online grocers and restaurant marketplaces. | | | | | | | | | Europe's median VC round swells as investors target larger deals | |  | | (alfexe/Getty Images) | | | The median European VC deal size has continued to grow as late-stage rounds account for a larger share of deal activity.
As overall VC funding has declined, investors are focusing their capital on follow-on rounds for more mature startups. | | | | | | | | | | A group of hedge funds seeks to cut off $1 billion meant for opioid victims. [The Wall Street Journal]
In Mexico, private cash is flowing to plug the so-called nearshoring energy crunch. [Reuters]
Influencers built up Daily Harvest, a vegan food company backed by celebs including Gwyneth Paltrow—until they started getting sick. [Bloomberg Businessweek] | | | | | |
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| | Since yesterday, the PitchBook Platform added: | | 460 Deals | 1988 People | 679 Companies | 8 Funds | | | | | | |
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The Daily Benchmark:
2016 Vintage Global Funds-of-Funds | | | | | | |
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An investment group led by Haveli Investments and joined by General Atlantic has agreed to buy Advent International-backed Certinia, a B2B software company. The deal valued the vendor at nearly $1 billion with debt, Reuters reported.
Bain Capital Tech Opportunities and Valeas Capital Partners have led an investment in Ren, a third-party company that administers charitable giving of nonliquid assets.
The Carlyle Group has extended a $200 million loan to iRobot, the maker of Roomba vacuums, as it awaits regulatory approval of Amazon's takeover of the company.
Jio Financial Services, the financial services arm of billionaire Mukesh Ambani's business empire, has inked a deal with BlackRock to launch an asset manager for Indian investors, called Jio BlackRock. BlackRock and Jio will each invest up to $150 million in the joint venture.
General Atlantic has announced a $160 million strategic growth investment in MAC Hospitals, one of Mexico's largest hospital providers.
Qatar's sovereign wealth fund, the Qatar Investment Authority, is considering a minority stake in billionaire Mukesh Ambani's Reliance Retail Ventures, the Financial Times reported.
Rcapital has completed its acquisition of UK elevator maintenance business Temple Lifts from Japanese conglomerate Hitachi.
KSL Capital has acquired luxury hotel chain Sereno, which has resorts on Lake Como in Italy and Saint Barthelemy island in the Caribbean.
Craftable, a SaaS platform for the hospitality industry, has received a strategic investment from Gauge Capital. | | | | | |
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Consumer-focused PE firm, Bansk Group, has closed its inaugural fund on $800 million.
CenterGate Capital has closed its second fund on more than $375 million, Buyouts Insider reported. The fund will focus on buyouts in the lower middle market. | | | | | |
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"Another source of credit for add-ons is net asset value (NAV) financing. Instead of using an individual company as collateral, these lenders use the NAV across a portfolio of companies held by a fund. This further explains why add-on dealmaking is so frenzied, as it is seen by sponsors as a way to fix up portfolios in advance of selling these platform companies further down the road, and every bit of leverage counts."
Source: PitchBook's Q2 2023 US PE Breakdown | | | | | |
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