Private Equity-Backed Buyout Deals in Texas – 2006 to 2012 YTD

by Jessica Hull

  • 02 Aug 2012
  • PE

Out of the 50 states in America, Texas is the second largest by area and population, so unsurprisingly over the period of January 2006 to 2012 YTD (as of August 2, 2012) this state has recorded a high number of deals with a large combined aggregate value – over this time period, 834 private equity-backed buyout deals have taken place in Texas, with an aggregate value of $196.7bn.

Over 2011-2012 YTD, a quarter of PE-backed deals located in Texas took place in the industrials sector. The energy and utilities industry followed closely with 23% of buyout deals. Unsurprisingly, the high abundance of natural resources located in Texas make both the energy and utilities and industrials sectors in the state attractive to private equity firms. The third most popular area of investment for private equity firms in 2011-2012 YTD was business services industry.

Since January 2006, the largest recorded PE-backed buyout deal took place in Dallas, Texas in the energy and utilities industry. During 2007, the privatization of Energy Future Holdings Corp by a consortium of investors was recorded at a whopping $45bn, with shareholders receiving $69.25 per share as part of the transaction. The second largest deal recorded in Texas saw Bain Capital and Thomas H Lee Partners join forces to take Clear Channel private for $24n.

Texas was no less affected by the global financial crisis than other states in America, and deal value and volume dropped significantly in 2009, when 89 deals valued at an aggregate $3.1bn. To put this in context, 2007 saw the peak number of deals reach 148 and 2006 recorded the highest aggregate value, $90.4bn. The number and aggregate value of deals witnessed in Texas has gradually rebounded from this dip in 2009, and 2012 YTD has already recorded a higher aggregate value than the entirety of 2011.

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