Record stock prices have curbed the number of companies that leveraged-buyout firms want to take private. Just 13 firms have announced they would go private so far this year. That is the fewest since 2001, when just 10 public companies announced, according to data provider Dealogic.



With stock prices up, “bargains are more difficult to find,” said Richard Peterson, an analyst at S&P Capital IQ. Take-private LBOs totaled $11.6 billion, down 83% from 2013’s year-to-date total of $68.9 billion.

Instead, private-equity firms are increasingly buying specialized divisions rather than their larger parent companies, Mr. Peterson said. Carlyle Investment Management LLC announced it would buy Johnson & Johnson‘s ortho-clinical diagnostics division for $4.15 billion in January.

Low interest rates and high stock prices, Mr. Peterson said, mean investors are “waiting for the pullback that, you know, never happens until something cataclysmic happens and then everything gets swept down.”

Some companies are willing to sell only low-performing divisions, he said, mentioning Procter & Gamble Co.’s agreement last month to sell Duracell to Berkshire Hathaway for $4.7 billion. A Procter & Gamble spokesman countered that the deal shows a “vote of confidence” in Duracell.

Tibco Software Inc. was the largest company to announce its public departure this year, at $4.3 billion. Telecommunications-equipment company Riverbed Technology Inc. and software firm Compuware Corp. will do the same in deals valued at $3.4 billion and $2.4 billion, respectively.

But those deals are dwarfed by last year’s largest. H.J. Heinz Co. went private in a $27.5 billion leveraged buyout, and Dell went off the market for $24.4 billion.


Copyright ©2014 Dow Jones & Company, Inc. All Rights Reserved.