IT Sector Stays Top Choice Of US PE/VC Investors In Q3

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IT Sector Stays Top Choice Of US PE/VC Investors In Q3

New S&P Analysis: IT sector stays top choice of US PE/VC investors in Q3, but volume dips

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Q3 2020 hedge fund letters, conferences and more

Information technology (IT) remained the most attractive sector among private equity and venture capital dealmakers in the Q3 despite the impact of Covid-19.

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IT sector

Key highlights from the analysis tracker include:

  • In the third quarter, the total number of deals in IT surged ahead of other sectors, reaching 1,537 entries for the year to Sept. 30.
  • Technology-focused assets have seen particular demand during the coronavirus pandemic as consumers look for online solutions.
  • In terms of year-on-year figures for the IT sector, private equity's overall cautious approach to dealmaking in 2020 is evident. Entries dipped by 17% to 443 in the third quarter for the most popular sector from 533 deals across the same period in 2019. Announced aggregate gross transaction value for IT entries in the third quarter was $9.97 billion, down by 32% year on year.
  • Total activity for the IT sector in 2020, including add-on transactions, hit 1,931 deals with a gross transaction value of $36.18 billion.

IT Q3

IT sector stays top choice of US PE/VC investors in Q3

However, in terms of year-on-year figures for the IT sector, private equity's overall cautious approach to dealmaking in 2020 is evident. Entries dipped by 17% to 443 in the third quarter for the most popular sector from 533 deals across the same period in 2019. Announced aggregate gross transaction value for IT entries in the third quarter was $9.97 billion, down by 32% year on year.

Total activity for the IT sector in 2020, including add-on transactions, hit 1,931 deals with a gross transaction value of $36.18 billion.

IT Q3

Some big IT deals concluded during the third quarter. Bain Capital Pvt. Equity LP's investment of $750 million in convertible notes in enterprise cloud computing company Nutanix Inc. was the largest IT entry, according to S&P Global Market Intelligence data.

Read the full article here by S&P Global Market Intelligence

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Jacob Wolinsky is the founder of ValueWalk.com, a popular value investing and hedge fund focused investment website. Jacob worked as an equity analyst first at a micro-cap focused private equity firm, followed by a stint at a smid cap focused research shop. Jacob lives with his wife and four kids in Passaic NJ. - Email: jacob(at)valuewalk.com - Twitter username: JacobWolinsky - Full Disclosure: I do not purchase any equities anymore to avoid even the appearance of a conflict of interest and because at times I may receive grey areas of insider information. I have a few existing holdings from years ago, but I have sold off most of the equities and now only purchase mutual funds and some ETFs. I also own a few grams of Gold and Silver

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