Private equity firms slow deal activity from torrid pace

Private equity firms completed deals totaling about $330.8 billion in the first quarter. The dollar volume was lower than the previous period's $387.3 billion, the highest total in the past 10 years.

Private equity companies made 2,166 deals in the first quarter, down from more than 3,100 in the fourth quarter. The number had been on the upswing since the second quarter of 2021.

Private equity buyout deals slipped 700 basis points to 42.3% of the total private equity dollars invested. Add-on and growth investments increased to 44.7% and 12.9% , respectively, from 40.4% and 10.4%.

When purchasing companies, private equity firms paid an average enterprise value to EBITDA multiple of 14.6 times, flat from the fourth quarter. However, the valuation is higher than the 12 to 14 EV/EBITDA multiple private equities have paid over the past several quarters.