Axial, a trusted deal network for the middle market, announced its members have closed more than $25 billion in deals on 2,000-plus M&A and growth capital transactions since Axial’s launch in 2010. To facilitate these closed transactions, Axial arranged more than 2.1 million private member-to-member deal connections. Nearly one-third (650) of the total transactions closed in 2017.
“Axial’s real-time data and technology is transforming how private capital market participants connect and source middle market deals,” said Peter Lehrman, Axial’s founder and CEO. “We see a dynamic year ahead for middle market M&A and growth capital activity against a backdrop of capital superabundance, a new corporate tax regime and record-high equity valuations.”
In 2017, the revenues of businesses that privately transacted using the Axial deal network ranged from $2.9 million to $610 million, with EBITDA ranging from negative $19 million to $223 million. Top sectors of deal flow activity include Business Services, SaaS, Healthcare IT, Distribution & Logistics, and Manufacturing. Notably, 24% of all growth capital transactions attempted in 2017 were in the Technology sector, more than doubling year-over-year from 10% in 2016.
The year ahead could bring record M&A activity from strategic buyers, putting even more upward pressure on multiples and making it harder for private equity firms to find attractively priced deals. With many PE firms also competing with limited partners and family offices that are doing deals directly with sellers, investment professionals are leveraging networks like Axial to maximize the reach of their relationships.
Included among the more than 1,300 investment banking members active with Axial in 2017 are boutique investment banks 41 North Partners, Allegiance Capital, Copper Run Capital, Capstone Headwaters, Hilliard Lyons, Progress Partners, and Seven Stage Advisors.
"We joined Axial to enhance our sourcing efforts,” said Vincenzo LaRuffa, Partner, Aquiline Capital Partners, a New York-based private equity firm. “We have had a lot of success as a member and are excited to continue using Axial's deal network in 2018 to build market leaders in financial services and financial technology.”
The Axial network includes private equity and private credit members such as Alpine Investors, Decathlon Capital Partners, SFW Capital, Oaktree, Huron Capital Partners, Tregaron Capital, and Sterling Commercial Credit. Additionally, strategic buyer members include High Road Capital Partners’ marketing services platform BlueSpire, Levine Lichtman’s environmental services platform Trinity Consultants, Ontario Teachers’ Pension healthcare platform PhyMed Healthcare Group, and TPG’s healthcare services platform Precision for Medicine.