Private equity deal activity remained solid throughout 2020, despite a significant decrease in Q2, proving the resilience and agility of financial sponsors in a challenging market. The onset of the COVID-19 pandemic did not cause private equity transactions to stop entirely, but instead caused them to be delayed, with certain sectors – such as tech, FinTech, and life sciences – remaining more active than other sectors.
Our Private Equity practice has continued to advise private equity funds on a range of mid-market and large-cap transactions, including secondaries and co-investments across multiple sectors and jurisdictions.
As long as the debt market remains open, buyouts will continue to occur in 2021, resulting in a significant increase in number and volume of transactions compared to 2020.
While some private equity funds may retain assets for extended ownership periods, given the uncertainty of economic outlook in certain areas and the demand for assets in other areas, other funds, particularly in the healthcare and tech sectors, are expected to seize opportunities both on the investment and divestment side.
We also anticipate continued interest in public to private transactions as well as an increase in distressed deals. SPAC activity has been surging over the last year, and we see this trend continuing as market volatility has made IPOs a longer path to exit. The significant number of SPACs looking for deals will increase competition for larger transactions.