- Tech dealmaking through November on record pace
- Preqin: Industry has $190 bln available capital
- Tech-focused PE assets twice level of 5 years ago
Buyout firms have shown a heightened interest in technology dealmaking this year, with a record-pace 1,079 buyout-backed transactions globally through mid-November.
Looking ahead, activity appears unlikely to slow, barring an economic downturn, with the industry holding $190 billion of available capital and new fundraising maintaining relatively strong momentum.
With six weeks remaining to 2018, deal volume is on track to pass the 1,096 transactions of 2017, the current annual record, according to Preqin. Buyout shop activity has climbed steadily in the nine years since 2009, though not always deal value.
In the process, buyout funds have zeroed in on venture-backed startups, where they see the opportunity to invest in growth.
This year’s activity has pushed assets under management to a record $569 billion as of March, Preqin said. Technology-focused private equity assets are now twice what they were five years ago.
However, overall deal value has been on the decline since 2015 when the $67 billion Dell and EMC merger push annual value to a peak of $177 billion. So far this year deal value has come to $71 billion, down from 2017.
On the fundraising front, 286 tech-focused private equity funds have closed on $68 billion so far in 2018. This has brought the average fund size up to $238 million, another record.
From 2015 to 2017, more than $70 billion was raised annually.