Mostly sunny, with a few clouds. That best describes the deal climate investment bankers at Skyway Capital see ahead for 2015.
“We remain generally bullish although there are concerns,” said Scott Feuer, CEO of the Tampa-based firm, citing fears over dropping oil prices that could indicate diminished demand as well as other macroeconomic factors.
Overall, the outlook is good for mergers and acquisitions and for raising capital, Feuer said. Banks are lending, non-bank finance companies have made a lot of funding available and there’s still plenty of money on the sidelines in private equity funds, which broke past $1 trillion in 2014.
There were at least 35 major deals valued at more than $10 billion in 2014 in Tampa Bay, and more than $3 trillion in deals worldwide, according to PBS NewsHour.
At least four deals were announced in the first week of 2015:
Dow Electronics in Tampa agreed in principle to buy Eagle Distributors in Kenner, La.
Florida Agency Network acquired Bella Title, a Land O’ Lakes-based real estate title company
Atlas Professional Services in Tampa bought the IT data servicesbusiness of Infinity Computer Solutions
PrimeGroup Insurance bought two central Florida insurance agencies.
Skyway also announced its own deal, selling InStep Software to global energy firm Schneider Electric.
InStep, a Chicago-based company that provides performance management and predictive analytics software, is the No. 1 or No. 2 player in each of its markets. That was one key to the sale, Feuer said. “People don’t want to buy buzz. They are looking for companies that are special or unique by themselves or as bolt-ons to an existing business.”
The company’s focus also was important, Feuer said. “Bigdata is a market where we start moving into the Internet of Things. It’s a hot segment and one we knew would be attractive.”
While financial terms were not disclosed, InStep is at the lower end of the middle market, said Kyle Schroeder, Skyway vice president. Private equity firms tend to focused on bigger companies, so “we see a lot of people going more downstream to increase their yield and return on capital, to find those opportunities that have been less actively pursued.”