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Analysis

US divestitures Q2 2022 update

US divestiture activity slowed in the second quarter of 2022, but there is still strong demand for high quality assets with average transaction sizes and multiples increasing compared to Q1. The mix of acquirors, and of industry focus, remained consistent.

Our report

Our quarterly report focuses on:

  • US divestiture volume, value, and reported multiples
  • US divestitures by buyer type
  • US divestitures by industry
  • Cross-border divestitures activity

Transaction trends

  • Transaction volume
    Divestiture transaction volume declined in Q2 2022, compared to Q1 2022. Number of deals declined to 459 in Q2 2022, compared to 501 deals in Q1 2022, a drop of 8.4% quarter over quarter.
  • Transaction size
    Middle-market deals witnessed significant growth in Q2 2022, with deals between $250 million and $1 billion making up 52.0%, compared to 26.0% in Q1 2022. In Q2 2022, deals of more than $1 billion contributed 23.0% of the overall transactions.
  • Transaction multiples
    The average divestiture transaction multiple for Q2 2022 was 19.8x EBITDA. This marks the seventh consecutive quarter with no deals closing below 5x EBITDA, and it is the highest average quarterly multiple since the COVID-19 pandemic.
  • Acquiror type
    The mix of acquirors was largely consistent with previous quarters. In Q2 2022, 52.0% of acquirors were domestic strategic, 37.0% private equity, and 11.0% foreign strategic.
  • Industry focus
    In line with Q1 2022, the technology sector accounted for 15.4% of total deal volumes, representing the largest share in Q2 2022, followed by industrials at 13.5% and energy and power at 12.6%.

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Regional trends

  • Europe
    Deal activity among European acquirors declined 33.3% in Q2 2022, compared to Q1 2022—likely driven by ongoing geopolitical tensions.
  • Americas
    Divestiture activity in the Americas witnessed a 9.5% quarter over quarter decline in Q2 2022. The Americas completed 381 transactions in Q2 2022, compared to 419 transactions in Q1 2022.
  • Asia
    Divestiture activity in Asia grew 21% quarter over quarter with 17 closed transactions in Q2 2022, compared to 14 in Q1 2022.

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Source: Refinitiv data, as of June 30, 2022.

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