Overcoming the exit impasse

With private equity exits hitting a post-pandemic low point and
dealmaking proving challenging due to financing conditions and
valuation gaps, Harriet Matthews and Rachel Lewis discuss the
current PE exits landscape, with a guest interview from Equistone
senior partner Steve O’Hare.


Secondary buyouts (SBOs) in particular have suffered in 1H 2023,
with just 41 getting over the line as GPs remain reluctant to
bring assets to market and are cautious around deployment on the
buyside.


In an interview with Unquote, O’Hare shares his and Equistone’s
experience of making exits in the current market, having made
eight realisations in the past year and a half. He discusses
topics including the importance of preparation in bringing an
asset to market, the role of advisers, and the GP’s value
creation methods.


Following the interview, the Unquote team assess key takeaways,
including the role of financing in getting deals over the line as
well as the market’s hope for a wave of pent-up demand as
advisers appear to be getting increasingly busy.


The team also assesses the prospects for GP-led secondaries as an
exit route, as well as the changing role of EBITDA in auctions,
with prospective buyers placing more emphasis on cashflows and
profitability.


1:20 – Breaking down Mergermarket’s data


4:56 – Assessing the obstacles


7:38 – Interview with Steve O’Hare, senior partner at Equistone


21:45 – Key takeaways: Debt


27:00 – Pent-up demand


28:40 – GP-led hopes and creative solutions


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Podcasts.


Theme music: 2012 Kick Up The Fire