Peak season for exits in 2015?
24. February 2015
1. How do you assess the “weather situation” for exits among private equity companies and investors in the current year?
The weather situation for private equity in Germany is indeed better than it has been for a long time. For example, the investor group of EIS Aircraft managed a bravura exit with an impressive multiple in just over 3 years. Private equity firms have a lot of ‘dry powder’. In addition, the available liquidity in the markets facilitates efficient and successful fundraising. Overall, however, there are still too few takeover candidates (primaries), especially from the midmarket. Combined with the ample availability of debt capital, this status quo naturally continues to drive up prices, especially for mid-cap secondaries. This makes it an ideal time for exits of operationally strong companies with an intact growth story.
2. What procedure preceded the sale? Was there an auction? How many bidders were involved?
The sellers had opted for a quiet process with pre-selected bidders. As expected, interest was extremely high among a large number of strategists and financial investors.
3. Can you tell us about the investors? Are there any more deals to be expected here? What is the leverage at EIS Aircraft?
It was a very successful deal for everyone involved. The strategy of bringing about fundamental, operational changes with a great deal of effort has paid off in full. EIS Aircraft is expected to continue to grow disproportionately. Leverage contributed only marginally to the double-digit money multiple. The sellers have a strong operational background with deep experience in strategy consulting and private equity. It is likely that we will see this successful strategy in their next deals as well.