The equipment rental industry has experienced a flurry of activity in the first quarter of 2006. As FocalPoint predicted last year, many industry consolidators are taking advantage of the improved business environment to exit at more attractive valuations or, alternatively, are tapping the strong capital markets. NES Rentals and RSC Equipment Rental announced their intention to sell and H&E Equipment has successfully completed a public offering. FocalPoint anticipates that private equity firms will ultimately emerge as the buyers for some of these large consolidators.
FocalPoint also notes strong activity in the middle-market with an increasing number of private companies seeking to expand into new territories or to acquire smaller, regional competitors. These companies are taking advantage of the aggressive capital markets to access growth capital from banks, mezzanine debt funds and even private equity firms to facilitate and accelerate their regional growth strategies.
In our view the outlook for the equipment rental industry in 2006 and 2007 remains strong.
For the full Equipment Rental Quarterly Report, please click here
FocalPoint is an independent investment bank, specializing in mergers and acquisitions, private placements (both debt and equity), and financial restructurings. The firm’s primary focus is on middle-market companies with revenues between $10 million and $250 million in a diverse range of industries.