DATA AS OF JUNE 30TH, 2021
A VIEW OF 1H 2021: FLORIDA PE DEAL REPORT
THIS INFOGRAPHIC REPORT AND ALL ASSOCIATED CHARTS, PREPARED BY CASSEL SALPETER & CO. WITH DATA FROM PITCHBOOK AS OF JUNE 30TH, 2021, PROVIDES A TOP-LEVEL EXAMINATION OF PRIVATE EQUITY ACTIVITY IN FLORIDA. IT OFFERS IN-DEPTH INSIGHT AND DATA-DRIVEN ANALYSIS OF THE STATE’S PE TRENDS, WITH A FOCUS ON DEAL FLOW ACTIVITY. THIS REPORT INCLUDES ALL PE INVESTMENTS (INCLUDING BUYOUT, ADD-ON, GROWTH, AND RECAPITALIZATION), EXCLUDING REAL ESTATE INVESTMENTS, MADE INTO TARGET COMPANIES WITH HEADQUARTERS IN FLORIDA.
Florida PE Deal Flow by Year
2010
174
20 11
185
201 2
233
2013
207
2014
25O
2015
286
2016
281
2017
337
2018
350
2019
352
2020
386
1H 2021
254 0
50
100
150
200
250
300
350
400
Florida PE deal activity set a record-setting pace through 1H 2021, with 254 deals completed. Many signs point to this robust Florida deal activity continuing, including the proposed capital gains tax increase.
Florida PE Deal Flow by Region
100% TA M PA B AY
90% 80%
SOUTHWEST
70% 60%
SOUTHEAST
50% PA N H A N D L E
40% 30%
NORTHEAST
20% 10%
CENTRAL
0% 2010
2011
2012
2013
2014
2015
2016
2017 2018 2019 2020
1H 2021
The Southeast region remained the prominent area for Florida dealmaking, accounting for approximately 40% in 1H 2021. This is in line with 2020 where the Southeast region accounted for approximately 39% of all Florida PE deals. The Central and Tampa Bay regions followed accounting for approximately 19% and 18%, respectively. The Northeast regions saw a slight increase, jumping from approximately 9% in 2020 to 11% in 1H 2021. The Southwest and Panhandle lagged, accounting for approximately 9% and 3%, respectively.
Florida PE Deal Flow by Quarter 147
150 140 130
123
120 110
103
100 90 80 70
62
60 50 40
51 53 52 49
50
48 38
43
38
59 58 51
64
84
83
80
80
79
60
63
99
97
95 82
93
86 74
68 69
77
90
86
95
83 77
73 63
60
54 52
39
29
30 20 10 0
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
Florida PE deal activity saw robust deals completed in 1H 2021, with Q1 2021 being the second highest quarterly deal quantity we have on record. Frenzied dealmaking will likely continue throughout 2021 with the proposed capital gains tax making business owners contemplate a sale more seriously.
Florida PE Deal Flow by Type
100% P L AT F O R M C R E AT I O N
90% 80%
G R O W T H / E X PA N S I O N
70% RECAP
60% 50%
ADD-ON
40% BUYOUT/LBO
30% 20% 10% 0% 2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
1H 2021
While Add-On’s have always been the largest type of Florida PE deal activity, we have seen a significant increase in percentage over the years, from approximately 49% in 2016 to approximately 60% in 1H 2021. Buyout/LBO and Growth/Expansion followed with approximately 20% and 19%, respectively. Leveraged Recapitalization and Platform Creation both accounted for less than 1%.
Florida PE Deal Flow by Sector
100% 90%
M AT E R I A L S & RESOURCES
80%
IT
70%
H E A LT H C A R E
60% 50%
FINANCIAL SERVICES
40%
ENERGY
30%
B2C
20%
B2B
10% 0% 2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
1H 2021
Despite B2B remaining the top sector for Florida PE deal activity, accounting for approximately 39%, the Healthcare and IT sectors held steady into 1H 2021 accounting for approximately 19% and 17%, respectively. Conversely, the B2C sector plunged from approximately 17% in 2020 to 13% in 1H 2021. The Financial sector accounted for approximately 8%, while both Materials and Resources and Energy each accounted for less than 5% of Florida PE deal activity.
Florida Buyouts vs. Add-ons
70.8%
350
67.1% 300
61.0%
68.3%
66.5%
66.3%
72.5%
74.9% 66.5%
60.9%
61.5%
70%
56.7% 60% 214 200
40% 152
136
195
50%
102
118
30%
51
108
76
99
83
88
76
20% 56
50
61
53
50
74
80
83
150
137
151
200
179
250
100
80%
0
10% 0%
2010
2011
2012
2013
BUYOUT/LBO
2014
2015
ADD-ON
2016
2017
2018
2019
2020
1H 2021
ADD-ON %
Add-on’s continue to propel Florida PE deal activity, accounting for the majority of Florida PE control investments in 1H 2021. Hitting an all-time high in our records, Add-On’s accounted for approximately 75%, illustrating that an inorganic growth strategy has become essential for PE firms’ buy-and-build strategy.
PE-Backed Florida Companies 600 556
571
496 477
500 442 390 359
400 311 271
300
320
340
287
244 249
YEAR OF INVESTMENT
217
170
200
100
72
84
96
110
121
2014-1H 2021
138
2007-2013 2000-2006 PRE-2000
0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
2011
2012
2013 2014 2015 2016
2017 2018 2019 2020
1H 2021
Florida PE-backed company inventory continued to grow, with an additional 15 new PE-backed Florida companies. This growth has slowed in comparison to 2020 and it will be interesting to see what year-end 2021 brings. Of interest is the Florida PE-backed company inventory acquired between 2007 and 2013 for a second report has shown a diminished proportion of exit activity as compared to that seen in 2019.
Florida PE Exits by Type 100 90
3
80 3
70
25
35 2017
23
50 2016
16 2014
24
31
2013
30
26
2012
37
38 24
19
31
20 10
4
15
23
21 6
12
30
6
31
2
40
3
36
50
1
33
4
4
31
4
30
60
35
2
0 2010
2011
Corporate Acquisitions
2015
Secondary Buyouts
2018
2019
2020
1H 2021
IPO
The primary exit route for Florida PE deals in 1H 2021 was secondary buyouts, which for a second report reverses the trend in which corporate acquisitions was a more popular exit option. Given the increase in IPOs and SPACs globally, it is surprising to see it again not reflected in our Florida PE data.
Florida-Based PE Firms 110
102 100
95
90
79
80
72 70
60
56 47
50
41 40
30
27
30
32
34
37
20
10
0
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
While the number of PE firms with headquarters in Florida increased, it did not skyrocket like we saw in 2020. It is important to note that the likely increase in 2020 was due to many firms moving to the sunshine state while working virtually for the Florida warmth and for tax purposes.
1H 2021
METHODOLOGY
PRIVATE EQUITY DEALS This report includes all PE investments (buyout, growth, recapitalization, and add-on), excluding real estate investments, made into target companies, with headquarters in Florida. Only investments made directly by private equity firms or their portfolio companies are counted. Buyout deals are defined as transactions in which the PE investors receive controlling ownership stakes in the target companies. Growth deals are defined as minority investments in target companies. Add-on deals are defined as acquisitions by companies with private equity backing.
FLORIDA-BASED PRIVATE EQUITY FIRMS
PE-BACKED FLORIDA-BASED COMPANIES
This report includes PE firms with headquarters in Florida that were either actively investing or raising funds during the reported periods.
This report includes companies headquartered in Florida that are in part or in whole backed by PE firms.
Cassel Salpeter & Co. is a boutique investment banking firm focused on providing independent and objective advice to middle market and emerging growth companies.
801 Brickell Avenue, Suite 1900, Miami, Florida 33131
•
305-438-7700
Mergers & Acquisitions | Capital Raising | Fairness & Solvency | Restructurings | Advisory Services | Valuations www.CasselSalpeter.com
Member FINRA | SIPC