By Chibuike Oguh

BERLIN (Reuters) – Private equity dealmakers are descending on Berlin for their annual get-together, with their industry thriving and many of them wondering how long the good times will last.

Armed with billions of dollars, buyout firms have already taken advantage of what has been a record year for mergers and acquisitions (M&A), selling some of their assets for top dollar.

Private equity-backed M&A deals more than doubled to a record $818.4 billion in the first nine months of this year, up from $315.2 billion last year, according to Refinitiv.

The S&P private equity index, meanwhile, is up 43% so far this year, compared with a 25% gain in the benchmark .

Shares of the biggest private equity firms, including Blackstone Group (NYSE:) Inc, KKR & Co (NYSE:) Inc, Apollo Global Management (NYSE:) Inc, Carlyle Group (NASDAQ:) Inc & Ares Management (NYSE 🙂 have risen as the U.S. economic recovery and the easing coronavirus restrictions has boosted.

According to Pitchbook, this was the highest record-setting rate for return in private equity, at 33%, March 2021.

Dealmakers believe that the pace of business will continue despite the threat of inflation. Top industry executives have hundreds of millions in management fees.

Brian Bernasek (co-head U.S. buyouts at Carlyle), stated that there are “certainly some inflationary forces combined with a somewhat of an easing pandemic global.” “We anticipate a strong environment in which to remain, although perhaps there is less steam.”

The annual SuperReturn International conference will also focus attention on the labor shortage faced by many U.S. companies – which is a concern for private equity-owned businesses.

Michael Psaros (managing partner, KPS Capital), said that people have been paid not to leave their homes. He also stated that despite a surge in demand, orders for his companies’ industrial businesses are still being fulfilled. “The effect is the opportunity loss or missed profit.”

Although larger buyouts have not been common this year, there have been some deals between private equity firms to purchase large companies, increasing expectations that these so-called “club deals” might happen more frequently.

Most buyout companies assume control and seldom work with other firms.

But in June, Blackstone, Carlyle and Hellman & Friedman together agreed to buy medical supply and equipment company Medline Industries Inc for $34 billion, including debt.

Monday’s deal between Crosspoint Capital Partners and Permira Advisers LLC (Advent International) was worth $14 billion.

Dealmakers claim that more of these deals may occur with capital available, but some also point out the high level of debt in the sector.

Scott Graves co-head, private equity at Ares Management said that while the market for private equity is more leveraged than the public on a relative basis, it also offers better returns and duration.