GPs face high multiples, ‘creative’ Ebitda adjustments to find deals: Riverside’s Kriscunas

  • Specialization can help firms navigate pricey environment
  • Riverside made two deals in Texas this year
  • Kriscunas leads 40-member team in Dallas

A local presence and specialization can help middle-market private equity firms navigate the hypercompetitive environment.

That was the sentiment from Suzy Kriscunas, managing partner at Riverside Co, who gave a keynote address at Buyouts Insider’s PartnerConnect Texas conference in Dallas Nov. 11.

Kriscunas, who leads a 40-member team for Riverside in Dallas, said current challenges include sifting through “creative” pro-forma Ebitda-adjustment calculations on tight time frames to make investments decisions.

As well, purchase-price multiples are at near peak levels and aren’t expected to come down, considering private equity’s large amount of uncalled capital, she said.

But Riverside looks for opportunities in Midwest industrial companies, especially in specialty manufacturing and distribution, Kriscunas said.

Riverside, which invests in companies with Ebitda of $10 million to $35 million, made two acquisitions in Texas this year.

Platform acquisitions are tougher to find, but more than two-thirds of add-ons in Riverside’s portfolio were proprietary, she said.

Riverside acquired Clarus, an innovator in glassboards, from Bertram Capital in May 2018. Riverside was able to help Clarus go international; a manager relocated to the U.K. and was generating a lot of business. Italy would be another go-to market, Kriscunas said.

Abracon, a provider of timing, synchronization, power, connectivity and radio frequency solutions, was acquired in July. Riverside will help it grow with additional products and acquisitions, Kriscunas said.

Action Item: BI’s PartnerConnect Texas event: