Lower Middle Market Weekly Outlook

Good morning, Forum readers. Hope you had a nice Mother’s Day.

Last week saw no shortage of news and events for the capital markets. On the public front: Alibaba executed its much anticipated IPO, Apple entered into talks to buy Beats Electronics for $3.2 billion, and Publicis and Omnicom called off their merger.

In the private capital markets, the SEC has continued its investigation into PE firms. Click here to read a speech from SEC’s Andrew Bowden discussing the inspections and examinations. One of the biggest red flags amidst investigations has been how PE firms pay their operating partners.

Below are some other stories, transactions, and events to help you start your week…

Transactions:

• Huron Capital backs Valentus Specialty Chemicals
• Teakwood Capital exits ExamSoft
• Mosaic Capital receives SBIC license
• NanoH20 acquired by LG Chem
• Graphite sells Education Personnel to management team
• Hastings Equity Partners acquires Three Amigos Rentals
• Monroe Capital backs Gracelock Industries
• Stonehenge Growth Equity Partners backs MobileHelp
• Graycliff Partners acquires Ameritherm
• Hillshire Brands to acquire Pinnacle Foods
• Clayton, Dubilier & Rice to acquire Mauser Group

Upcoming Events:

• Monday in DC: Global Private Equity Conference
• Tuesday in Dallas: Axial’s Spring Summit South
• Tuesday in Dallas: Optimizing Financial Performance in Portfolio Companies
• Tuesday in NYC: How Online Retail Continues to Challenge Traditional Models
• Wednesday in Scottsdale: Southwest M&A Conference
• Thursday in NYC: Axial Breakfast Series
• Thursday in NYC: 10th Annual M&A DealSource

Opinions:

• Private equity leaves money on the table?
• Midsize, regional banks rush to grow through mergers
• PE firms in Europe turn to IPOs to cash out
• Business buyers going all in
• Pensions funds wrestle with what to do with cash from private equity
• Stock market bubble talk may be inflated
• The failed Publicis Omnicom merger is great news for advertising
• Defense firms seek mergers to survive budget cuts
• PE firms digging for gold in the mining industry
• The rise, fall, rise and fall of Barclays Investment Bank
• The human factor in merger collapse
• Is there still money in BRICs? Many say yes

This week in history… 24 stockbrokers gathered outside 68 Wall Street to sign the Buttonwood Agreement, the contract that founded the New York Stock Exchange (1792).

Member Spotlight:

Main Street Capital Corporation is a Houston-based publicly traded investment firm (NYSE: MAIN) that provides long-term debt and equity capital to lower middle market companies and debt capital to middle market companies. Main Street’s portfolio investments are typically made to support management buyouts, recapitalizations, growth financings, refinancings and acquisitions of companies that operate in diverse industry sectors.

Main Street seeks to partner with entrepreneurs, business owners, management teams and other equity sponsors, and generally provides “one-stop” financing alternatives within its lower middle market portfolio. Main Street primarily invests in lower middle market companies with EBITDA of $3 million to $20 million. The typical investment ranges in size from $5 million to $50 million with the ability to partner on larger transactions.

For more information, please contact Jessica Whitman ([email protected] / 713-350-9221)