Middle Market M&A Growth In 2015, there has been a significant increase in the middle market interest in mergers and acquisitions. From Q2 2015 to Q3 2015, Middle Market companies considering a merger or expansion increased from 8% to 12%. In that same period, Middle Market companies looking to make an acquisition in the next twelve months grew from 16% to 19%. This improvement is a result of the low interest rates and positive growth in the Middle Market.

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 M&A Growth

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