Law360 Quotes Andrew Sagor on PE Deal Outlook for Second Half of 2023
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For its article, “Can M&A Bounce Back After Dismal First Half Of 2023?,” Law360 quoted Akin debt finance and private equity partner Andrew Sagor. The article looks at the potential resurgence in M&A activity in the second half of 2023.
Andrew said that as debt financing has become more expensive, private equity firms have increasingly favored add-on acquisitions over leveraged buyouts. Andrew said, “I expect this trend to persist as these transactions enable portfolio companies to increase their valuations while offsetting interest rate costs.”
Andrew added that private equity firms have been “creative in bridging valuation and financing gaps” while noting that PE firms will continue to deploy such gap-bridging measures such as negotiating deferred or performance-based payments via earnouts and seller notes, and tapping fund-level facilities and alternative financing structures, such as preferred equity financings.
