The private equity midmarket is running scared. While Clifford Chance and Simpson Thacher & Bartlett are rubbing their hands in glee as the big boys, such as Permira and Blackstone Group, raise record-breaking buyout funds, there are mutterings of discontent from firms further down the food chain.
Dickson Minto senior partner Alastair Dickson has warned that, despite the recent raft of massive fundraisings, the summer is likely to be a lot quieter than in the past three boom years, and the autumn upswing is unlikely to fully rectify that trend. "I might be wrong, but the autumn will tell us… this could be the year that we see a correction," he says.
The warning of a blip in the market is nothing new, given that continuing nervousness in the stock market has already forced several companies to postpone or axe their flotation or share sale plans on the AIM and full market. The interest rate rise widely tipped for September is also unlikely to make deals any easier. What is new is the admission that the dip could impact on the golden child of the corporate market - private equity.
Given that private equity generated the vast majority of Dickson Minto's £29m revenue last year - up a whopping 56 per cent from £18.5m in 2002-03 before the corporate market began its correction - it's little wonder that Dickson is nervous about even a minor blip in the market. That said, partners at other private equity stalwarts are more reluctant to 'fess up to the possibility of the next big dip. Hardly surprising given the cash that the likes of Weil Gotshal & Manges or Kirkland & Ellis have been splashing for big-name hires.
But the recent run of mega-funds is unlikely to suddenly come to a halt. Simpson Thacher client Blackstone's $15.6bn (£8.5bn) fundraising, announced last week, increases the bar further as the world's largest takeover fund. And Clifford Chance client Permira's e11bn (£7.6bn) fundraising is also none too shabby, being the largest fundraising to date by a European institution.
A source close to Permira is adamant that activity remains high. "With all the big funds being raised, it's hard to see why the market should be dropping off," he says. However, another industry insider argues: "The big groups are seeing the activity; if you're not acting for them then work may drop off."
In other words, Dickson's bearish approach seems justified. Next year may not be so rosy for the corporate midmarket.