AlixPartners mid-market debt report H1 2019

Macroeconomic uncertainty contributed to a significant decrease in LBO financings in H1 2019, however, overall activity remained relatively stable as lenders focussed on their existing portfolios.

We are delighted to release the latest edition of AlixPartners' Mid-Market Debt Report, based on our bi-annual survey covering over 100 bank and non-bank lenders active in the UK and European mid-market (debt transactions valued up to €300 million).

At a glance:

• European mid-market lending activity decreased in H1 2019, with lenders completing 6% fewer transactions than in H2 2018.
• Brexit uncertainty contributed to a 28% decrease in LBO activity in H1 2019. Lenders mitigated this decline by completing refinancing and add-on deals within their existing portfolios.
• Significant dry power and macroeconomic uncertainty resulted in fierce competition for the best credits, with borrowers benefitting from favorable terms as a result.
• The imbalance between available capital and opportunities may begin to narrow with fundraising showing the first signs of deceleration in H1 2019.
• ABL activity decreased significantly in H1 2019. Going forward, appetite for ABL is set to return given the macro-economic climate and the product's suitability in turnaround situations.