Lower Middle Market Weekly Outlook

Private equity firms should look to become more creative with their financing options in 2015. Gillian Tan of the WSJ reported, “Deal makers are adjusting to a new landscape in which the ability of banks to arrange loans for buyouts is now under close watch, with U.S. regulators seeking to curb deals they think burden companies with too much debt.” The regulatory guidelines, issued by the FRB in March 2013, are creating new opportunities for debt investors.

Last week also saw some helpful regulation for mid-market firms with the passage of The SBIC Advisers Relief Act (H.R. 4200). The bill exempts SBIC advisers from certain registration requirements.

In other news, M&A confidence may trickle down to the middle market in 2015 and carried interest may have originated in the bible.

Transactions:

• Intel acquires PasswordBox
• Searchlight Capital invests in General Communications Inc.
• Confluence acquires Orfival
• Cyprium sells Honsador
• SK Capital raises $1 billion with Fund IV
• Marlin Equity merges LogicBlox with Predictix
• Permira to acquire Teraco
• Marathon Capital advises First Wind on sale
• Autocam Medical acquires Southeastern Technology
• Archer Daniels Midland purchases Specialty Commodities Inc.
• American Capital Equity III invests in Schulman
• Bankrate acquires Wallaby Financial
• Rockbridge Growth buys the Robb Report
• Sterling Partners acquires Surgical Solutions
• Littlejohn recaps ArmorWorks

Events:

•  Wednesday Webinar: Axial + S&P Capital IQ Present Best Practices in Deal Sourcing & Valuation

Opinions:

• Mid-market M&A has fared well in 2014
• Wealthy investors want more private equity
• PE keeps betting big on online gambling
• Powerful general partners setting the terms again
• Middle market supply chain financing: The next frontier
• Family offices are successful mid-market investors
• Will cheap oil lead to big mergers?
• What you need to know about private equity investing
• PE is top choice of young Wall Street bankers
• Five ways branding and design can help M&A
• Why the next set of media mergers are about to start
• Private equity’s public energy holdings get hammered
• Pricy stocks curb LBO hunger
• Regulators deliver yet another message on leveraged lending
• Survey says: More exercise, less oil & gas for PE next year
• Why do hedge funds suddenly want to hire PE professionals?
• Did Carl Icahn cause the PE bubble?
• PE firms still waiting for a chance to sell in India
• Private equity and Africa: The promise and the challenge

This week in history… The New York Stock Exchange opens doors at its home, 10-12 Broad Street (1865).