Livingstone’s Quarterly Market and Transaction Report

Middle market remains extremely active

Still no signs of a slowdown anytime soon.

This year continues to be very active for M&A. Across the mid-market, companies are benefitting from rising sales and profits, as the U.S. economy enters its eighth consecutive year of expansion. Meanwhile, historically low interest rates continue to make debt an attractive financing option. As a result, U.S. M&A volume hit a record $1 trillion in the first half of 2015 (Thomson Reuters).

Livingstone’s pipeline doesn’t show any signs of cooling down either, with completed transactions up north of 20% year over year. One of the more interesting trends is the range of alternative lenders that have entered the mid-market. The leverage tolerance and aggressive terms from these available lenders, such as business development companies (BDCs), has pushed debt multiples up significantly.

We are also seeing family offices and fundless sponsors become viable and voracious acquirers alongside traditional private equity and strategic buyers. The confluence of debt availability and a broad buyer universe has resulted in historically high purchase multiples.

Steve Miles
Managing Partner, Chicago


Deals (Q2)


Deals (TTM)


PE Buyer or Seller (TTM)


M&A frenzy continues in Physical Therapy — environment is ideal for private practices exploring sale.

An M&A frenzy is taking place in outpatient physical therapy (PT). While the PT industry has been consolidating for 10+ years, private practice remains immensely fragmented and opportunities for buyers and sellers abound.

View PT Multiples 2004-2015

An influx of private equity-backed strategics are using M&A to consolidate. This dynamic continues to drive higher valuations and better deal terms. In fact, valuations have jumped upward by 25% to 50% in recent years.

For private practices interested in M&A or refinancing options, the landscape is ideal.

Ryan Buckley’s full outlook on M&A in the PT space was featured recently in Impact Magazine, the American Physical Therapy Association's exclusive magazine for private practices.

Ryan Buckley
Director, Chicago


GE’s sale is driving increased competition as competitors and alternative lenders rush to fill the void.

With roughly 15-20% market share in the lower middle market, GE Capital plays an outsized role in financing PE-backed deals. The impact from the sale of GE Antares to Canadian Pension Plan Investment Board (CPPIB) will play out over the coming weeks and months. We believe that CPPIB bought the GE Antares franchise with the intention of continuing the businesses as a market leader in structuring and syndicating sponsor-backed middle-market buyout deals. However, during the integration, we anticipate competitors to achieve some success displacing the former GE Antares group. As if this market was not competitive enough, we expect players such as Golub, NXT and Madison Capital to propose aggressive structures for the next six months to take advantage of the disruption in the market.

View Middle Market Debt Multiples

Tom was recently featured in a two part Q&A with the mid-market newsletter The Lead Left (pt. 1, pt. 2). Also be sure to check out Livingstone’s Quarterly Debt Advisory Perspective, The Wire, coming out next week.

Tom Lesch
Debt Advisory
Partner, Chicago


5th Annual Midwest Bank & Financial Institutions Special Assets Forum

Joseph Greenwood, Partner focused on Special Situations was a featured panelist at IMN’s 5th Annual Midwest Bank & Financial Institutions Special Assets Forum in Chicago on September 17.

Nordic Forum

Livingstone will be hosting a forum with roundtable discussions on October 19 featuring partners from Livingstone’s Stockholm office in addition to other experts on business and M&A in the Nordic region. Please contact Abby Gates for more information.

After Dark

The 8th Annual Livingstone After Dark will be held on October 19. Please contact Abby Gates for more information.

Recent Press

Livingstone has been featured in Chicago media recently:

  • Chicago Tribune: Photo essay of Livingstone’s Chicago office, which recently completed a build out.
  • Crain’s: Livingstone’s David Sulaski quoted in Crain’s story about increasingly active family office buyers across the middle market.

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