Middle Market Growth is Strong Steady

According to the latest report by the National Center for the Middle Market, revenue growth has averaged 6.3% over the last 12 months ended September 30, 2016 for the sector. The middle market sector is expected to grow at a 4.9% rate over the next twelve months. This growth rate is much stronger than the S&P 500 group of companies which only grew at a 2.5% rate over the past year.

In the acquisition financing arena, capital availability is destiny as companies require reliable access to capital to grow over the long term. Unforeseen capital needs usually arise when acquirers least expect it. This can cause some concern for the acquisition financing provider, especially when covenants tighten up and that working capital availability is utilized faster than expected.

Mezzanine debt borrowing is usually a straightforward activity that many companies use for funding of transitional growth. Mezzanine debt lenders are highly transparent about their due diligence approach and their post-closing loan management making it easy for companies to engage with.

Elections have consequences and positive ones at that for the acquisition financing middle market. While much media attention is paid to the direction of the yield curve and the Fed’s likely rate cuts, scant attention is paid to the more important drivers of the acquisition financing market – business psychology and regulatory climate.

Middle Market Growth is Strong & Steady

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