The manufacturing industry is thriving and that’s expected to continue in 2015. In fact, according to Brown Gibbons Lang and Company’s Industrial Insider letter published in November 2014, an expanding U.S. manufacturing sector is spurring investment.
This is evidenced by a substantial uptick in both deal volume and value. During the first three quarters of 2014, middle-market M&A activity was tracking well ahead of 2013’s pace, with deal volume and value up more than 22 percent and 27 percent, respectively. Deal volume increased by more than 14 percent in the third quarter of 2014 over second-quarter levels, with deal value up 11 percent.
“I don’t see things drastically changing from 2014 to 2015, M&A on the manufacturing front is robust. Strategics are buying up competitors and private equity firms are interested as well,” says Christopher Sheeren, a partner with Detroit-based Huron Capital Partners.
“I also expect to continue to see manufacturers coming back to the U.S. China is experiencing its lowest growth in 25 years.”
Strong deal flow, capital availability, ample leverage, a surplus buyers and the energy boom are playing a part in the uptick in M&A in the manufacturing sector.
“We are bullish on chemical and coding manufacturers. All the equipment needed in the energy sector that remains outdoors needs coding and we are seeing a big demand here,” says Sheeren.
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