SEC Fairness Opinion Requirement Has Not Slowed GP-Led Secondaries

Rising regulatory burdens contributed to the stunning growth in private equity the last two decades and private credit in recent years. PE investors ultimately require liquidity, however. Subdued M&A and IPO markets since mid-2022 have spurred growth for private equity secondaries, which mostly consists of GP-initiated transactions for continuation funds and LP-initiated transactions for portfolio interests.

Is It Time to Eat the Golden Goose?

Banks have been divesting their insurance subsidiaries at favorable valuations over the past decade, driven by factors such as higher capital requirements, lower returns compared to public insurance brokers, and increased private equity interest in insurance agencies. This has allowed banks to redeploy capital, improve capital ratios, and focus on their core banking business.

Potential Impact of Baltimore Bridge Collapse on the Logistics Industry

The recent collapse of the Francis Scott Key Bridge, a crucial link for the Port of Baltimore, is the most recent upheaval in the logistics industry amidst a series of global disruptions. This incident not only underscores the vulnerability of supply chains to unforeseen events but also signals potential short-term delays and long-term shifts in cargo distribution across East Coast ports. As the transportation and logistics industry navigates these challenges, including labor disputes and global events affecting cargo routes, the implications of this collapse extend beyond immediate disruptions and will shape the future landscape of international trade and transportation.

Worldwide Impacts on Marine Shipping – Q4 2023

The ongoing battle between East Coast and West Coast ports is making waves in the logistics industry. Recent events like the El Niño weather event and attacks on vessels in the Red Sea have impacted marine logistics and transit times. The overall impact of these events remains to be seen, but it highlights the importance of keeping up with reshoring and nearshoring trends in the industry.

Coming Off the COVID Wave

The third quarter of 2023 has certainly been one for the books for the Transportation & Logistics industry. The shipping frenzy brought on by the COVID-19 pandemic has run its course and the industry is returning to more normal levels.  At the same time, it is important to note that a decline from never-before-seen highs does not necessarily indicate a freight recession is underway.  Many of the year-over-year data points will indicate large declines, but on a quarterly or monthly basis, the data is much more stable. 

Opportunities for Ownership Succession in the Beer Wholesaler Industry

Wholesalers seeking a strategic exit may be facing tighter market valuations. But the downside in previously robust transaction trends may represent a silver lining for wholesalers needing to achieve overdue ownership succession and favorable estate planning objectives. In this article we discuss how to take advantage of current market conditions to enhance the outcome of your ownership succession and estate planning strategies.

The Terminal Value

The valuation of portfolio companies usually is a straight forward process; however, it is more challenging in the current bear market following a period of wide-open monetary spigots that drove rich valuations for venture-backed firms. Capital raises were outwardly easy to complete as were richly valued exits via an IPO or M&A. For traditional PE-backed companies, low-cost debt financing was readily available, too, which often supported an extra turn or two of EBITDA for acquisitions and sometimes dividend recaps.

MedTech & Device – Industry Scan 2022

For this quarterly update, we bring together a couple of strands of our medtech and device industry practice. This article looks back at 2022 and also looks ahead to 2023.

Five Trends to Watch in the Medical Device Industry: 2022 Update

The medical device manufacturing industry produces equipment designed to diagnose and treat patients within global healthcare systems.  Medical devices range from simple tongue depressors and bandages to complex programmable pacemakers and sophisticated imaging systems.  Major product categories include surgical implants and instruments, medical supplies, electro-medical equipment, in-vitro diagnostic equipment and reagents, irradiation apparatuses, and dental goods.

In this article we outline five structural factors and trends that influence demand and supply of medical devices and related procedures.

FreightTech Update

The COVID-19 pandemic brought economic hardship to many. The second quarter of 2020 might go down as one of the quickest economic downturns ever recorded.  However, in an effort to protect the economy, the Fed created an extremely hospitable environment for venture capital, and with the glaring supply chain issues, FreightTech became a cushy landing place for investor’s money.  We have written about  venture capital and FreightTech before, and it has only gotten bigger since then.

Insurance Valuation Services for Financial Sponsors

Mercer Capital has worked with financial sponsors in the insurance industry for years and we understand both the dynamics of the industry as well as the accounting and valuation issues that are likely to be encountered. In this article, we list the key areas in which Mercer Capital can help with investment and transaction activity in the insurance sector.

ATRI’s Report on Critical Issues in 2021

In October 2021, the American Transportation Research Institute released its 2021 survey of Critical Issues in the Trucking Industry. In this article we discuss the results of over 2,500 respondents in the trucking industry.

Valuations for Gift & Estate Tax Planning

In this article, we describe the processes that lead to credible and timely valuation reports. These processes contribute to smoother engagements and better outcomes for clients.

Labor Shortage in Trucking Industry Leading to a Rise in Consumer Pricing

When the COVID-19 pandemic hit the United States in 2020, the demand for truck drivers increased sharply as many consumers turned towards online shopping. Even though trucking services were in high demand, the trucking industry struggled to grow its workforce during this time period. This coupled with other factors has had a serious impact on the economy.

Personal Goodwill: An Illustrative Example of an Auto Dealership

Personal goodwill was an issue in several of our recent litigated divorce engagements. It is more prevalent in certain industries than others and varies from matter to matter. However, although there are several accepted methodologies to determine personal goodwill, there is not a textbook that discusses where it exists and where it doesn’t. Before any attempts to measure and quantify it, an important question to ask is “Does it exist?” Often with ambiguous concepts like personal goodwill, the adage “you know it when you see it” is most appropriate. In this article, we examine personal and enterprise goodwill using a specific fact pattern unique to the auto dealership industry. Beyond this illustrative example, the analyses can be applied in other industries, but must be considered carefully for the unique facts and circumstances of each matter.

Trucking Industry Explosions and Implosions

The trucking industry has recently been shaken by a series of large accident-related litigation verdicts, also known as nuclear verdicts.  The definition of what constitutes a nuclear verdict can vary; however, the most common definition is verdicts in excess of $10 million.  No matter how they are defined, nuclear verdicts are causing upheaval in the trucking industry. 

Always Cash Flow and Earning Power

We recognize what matters today for many funds is helping portfolio companies survive a sharp drop in revenues rather than discerning how much first quarter marks may fall from the last valuation.

December 2019 SAAR

SAAR1 came in at 16.70 million for December 2019, as a shortened holiday season led to volume declines of 5.8%. However, total volume was 17,047,725 for 2019, the fifth straight year above 17 million. While volumes did decline, the drop … Continued