State of the Union: Private Equity is Helping American Manufacturers Grow and Expand
New Pitchbook Report Highlights How Private Equity Has Invested Over $1.4 trillion in 11,000 American Manufacturers Over the Past Decade
WASHINGTON, D.C. – Ahead of President Biden’s State of the Union Address, the American Investment Council and Pitchbook released a new report highlighting private equity’s robust investment in American manufacturing. The report — Manufacturing Across America — examines how private equity has invested more than $1.4 trillion in more than 11,000 manufacturing businesses over the past decade in every state of the country.
- “The enduring partnership between American manufacturing and private equity spans several decades and has powered many successful turnaround stories of beloved American brands, such as golf equipment manufacturer TaylorMade,” said AIC President & CEO Drew Maloney. “The State of the Union Address remains a significant moment to assess the American economy and recognize the indispensable role played by private capital across the nation.”
The report also showcases real-world examples of these partnerships and how they create growth opportunities for manufacturers that allows them to upgrade equipment, hire more employees, and build out new products and services to better serve their clients.
Key findings from the report include:
- Each year, nearly 1,000 manufacturers take on new private equity investments, and it is not uncommon to see at least $100 billion invested into these companies in any given year.
- Since 2012, almost 1,500 manufacturers across Texas, Oklahoma, Louisiana, and Arkansas, have received private equity investments, with capital infusions totaling more than $200 billion.
- Over the past decade, more than 2,700 manufacturers in the Great Lakes region have partnered with private equity, with more than $420 billion being invested in them combined.
- In the Mid-Atlantic region, which is home to thousands of manufacturers, more than 1,700 have taken PE capital amounting in $225 billion.
Examples of Private Equity-Backed Manufacturers
- In 2017, AIC member KPS Capital Partners led a revitalization effort into beloved golf manufacturer TaylorMade that empowered the company to invest in new product development and launch regional initiatives around the world. This dramatic shift in revenue, profitability, and market share resulted in KPS’ efforts with TaylorMade being awarded the 2022 “Turnaround of the Year” by Buyouts Magazine.
- In 2023, AIC member firm Platinum Equity acquired HarbisonWalker International (HWI), helping HWI finalize the revitalization of a recently defunct steel manufacturing plant based in Fairfield, Alabama. Platinum Equity’s resources helped the company reach new heights. As of late 2023, the factory is still hiring new employees.
- The Wellmark Company, a flow control instrument manufacturer in Oklahoma City, was a portfolio company of Platte River Equity. Platte River helped Wellmark develop a new line of products, all of which helped its clients increase their safety and boost productivity.
This year, members of the American Investment Council will host in-state events to spotlight private equity investments in local communities and small businesses, including manufacturers.
While the report highlights the support private equity provides for manufacturing, these investments support almost every industry in America, effectively fueling the economy, creating jobs, and building better businesses nationwide. This includes:
- Small Businesses: 85% of investments made by private equity support small businesses, providing them with the capital and guidance they need to grow and thrive.
- Life Sciences: Private equity is playing an increasingly important role in the growth and continued strength of the life sciences industry. In the last decade alone, private equity has invested $280 billion across more than 1,800 life sciences and medical device companies in the U.S.
- Infrastructure: Private equity is financing, managing and accelerating the completion of critical infrastructure projects, including those supported by the Infrastructure Investment and Jobs Act. Private equity investment in U.S. infrastructure surged to a record $45 billion in 2022.
The full report can be found here.
