Atlanta
Austin
Charlotte
Chicago
Columbus
Dallas
Denver
Des Moines
Nashville
NW Arkansas
Philadelphia
Tampa Bay
Twin Cities
Washington D.C.
Menu
Get smarter, faster about your hometown.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Please enter a valid email.
Illustration: Annelise Capossela/Axios
Before the turbulence of the last decade, retail LBOs followed a clear model. But with rich valuations and a low appetite for credit risk, retail has seen a dearth of traditional leveraged buyouts, even as the industry slowly emerges from the pandemic.
Why it matters: Private equity firms with dedicated retail practices will have to be more creative about how they invest in the sector going forward.
By the numbers: After spiking to more than $6 billion in the first quarter of this year, North American retail buyout volume sunk to less than $1 billion in the third quarter, Mergermarket data show.
Between the lines: Industry sources said credit markets are only willing to lever traditional retailers up to 2.5 X EBITDA currently, a decrease from up to 4.5 X in the first half of this year when buyouts of both Michaels and At Home group were transacted.
Investments in 2021 by Sycamore Partners, a private equity firm historically dedicated to retail LBOs, consisted of providing debt financing to apparel retailer Express, purchasing cruise ship assets from Royal Caribbean Cruises in an all-cash deal, acquiring Ste. Michelle Wine Estates and adding a bolt on to portfolio company Pure Fishing, for example.
What they're saying: "I think there are three types of retail investments that will continue to attract investor attention: site-based services, experiential concepts that can drive traffic and brand banner stores that serve as customer acquisition channels in a more diversified channel landscape," said Ryan Cotton, a managing director and global head of consumer at Bain Capital Private Equity.
Join the waitlist for Axios Pro, coming in early 2022.
Illustration: Shoshana Gordon/Axios
Retailers are fighting online anonymity to stop stolen goods from being resold on the internet.
Driving the news: CEOs of nearly two dozen retail companies threw their weight today behind legislation aimed at marketplaces like Amazon and eBay in a letter to congressional leaders.
Illustration: Aïda Amer/Axios
Look for carbon emissions from companies held by private equity to come under increasing scrutiny, a new report finds.
Driving the news: MSCI, the investment research and data firm, is out with its list of trends and topics to watch in the environmental, social and governance (ESG) space.
Illustration: Annelise Capossela/Axios
Inflation is bursting almost everywhere — a warning that rapid price spikes may stick around.
Why it matters: Until recently, high prices have been shrugged off as temporary, thanks to pandemic-era quirks (read: messed-up supply chains) that are expected to ease.

source