On Target: 2023 Private Equity Outlook
The Canadian private equity market saw several significant developments in 2022 that influenced deal activity across sectors. What are the key trends to look out for in 2023?
To help private equity firms, pension funds, sovereign wealth funds, venture capital firms and other market participants take stock of overall 2022 activity and the latest developments, McCarthy Tétrault’s National Private Equity Group has released its On Target: 2023 Private Equity Outlook.
Our report provides a holistic look at the private equity landscape over the past 12 months, including a detailed breakdown of 2022 deal numbers, and what to expect moving forward. From the ability of Canadian companies to handle rising inflation and borrowing costs to the increasing pressure by limited partners and potential sellers on private equity firms to have and disclose their ESG policies, we explore the key factors that could impact how PE firms deploy capital this year and beyond.
Get practical insights on the following trends and topics:
- Canadian private equity by the numbers, including by sector, PE-backed exits and deal size
- Implications of a hardening market
- The impacts of changing credit conditions
- Clarifications from the Canada Revenue Agency about loans to limited partners
- Proposed amendments to the Canadian Income Tax Act that may impose Canadian withholding tax obligations on foreign funds
- Proliferation of continuation fund transactions
- The race to green: a perfect storm for value creation or greenwashing?
- Canadian take-privates in 2022 and looking forward
On Target: 2023 Private Equity Outlook
Read an excerpt from the publication below:
2022 In Numbers – Canadian Private Equity Overview
After the feverish pace of 2021, the Canadian private equity market cooled down considerably in 2022. Rising inflation and borrowing costs coupled with major geopolitical events had PE firms acting more cautiously in respect of their capital deployment. As of December 16, 2022, the total amount of private equity capital invested in Canada in 2022 had only reached C$12.8 billion, based on disclosed deal value, a considerable decline from 2021 (C$21.8 billion) and the lowest since 2013 (C$7.3 billion). Deal activity also declined with only 475 transactions closed as of December 16, 2022, a decrease from the 598 closed in 2021, which was itself a record high.
Our clients include large and mid-market private equity firms, as well as pension funds, sovereign wealth funds, family offices, venture capital firms and other institutional investors, based in Canada and elsewhere. With offices across Canada’s major commercial centres and in New York and London, our national private equity team has substantial presence and capabilities to help our clients successfully complete transactions nationwide and across borders. We take an active interest in our clients’ businesses so that we can deliver best-in-class legal advice. As active participants in the private equity industry, we advise our clients on key trends and issues, mitigate risk and apply innovative strategies to acquisitions, dispositions, joint ventures and other transactions. Find out how we can help advance your business interests.
About McCarthy Tétrault
McCarthy Tétrault LLP provides a broad range of legal services, providing strategic and industry-focused advice and solutions for Canadian and international interests. The Firm has a substantial presence in all of Canada’s major commercial centres as well as in New York and London.
Built on an integrated approach to the practice of law and delivery of innovative client services, the Firm brings its legal talent, industry insight and practice experience to help clients achieve the results that are important to them.
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