2."In the new calendar year, private equity deals will pick up."
For private equity investors, concerns over the ability to get buyout financing, uncertainty about the refinance of existing leveraged investments and a slowdown in initial public offerings led to a big second half slowdown after a post-crisis high deals pace earlier in the year. As a result, private equity deals fell 7% in 2011. Expect the tide to turn back to growth in 2012, says Krouskos.
Investors currently watching private equity firms circle Yahoo! (YHOO), in addition to December buyout bids of Talbots (TLB), Blue Coat Systems (BCSI) may also see their companies taken private at big premiums. In U.S. takeovers, private equity firms have paid a 20% premium on average in nearly 3,000 deals, according to data compiled by Bloomberg.
Some of the biggest private buyouts of the year are KKR's purchase of Samson Investment, Blackstone's (BX) takeover of Kinetic Concepts (KCI) and a consortium of buyers for EMI. Additionally, Silver Lake turned heads when it sold Skype to Microsoft (MSFT) for $8.5 billion.Currently KKR's put the most money on the deals table, shelling out $16.9 billion to buy companies, followed by Blackstone and Apax Partners, according to Dealogic data, which shows that, the three firms have accounted for roughly 18.5% of 2011 private equity buyout activity. As investor funds come into KKR and Blackstone coffers, they may put their near record cash, called "dry powder" in recent earnings calls, to work investing in companies.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV