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Conditions 'perfect' for private equity exits
02 June 2014
Market conditions are perfect for exiting private equity investments in the West. Deploying new capital will require looking further afield or at smaller deals, finds Anthony Lane
As confidence in the global economy continues to grow, the
global private equity industry is reaping the benefits from a
surge of exits. Portfolio companies are either being sold or
listed on markets in what is widely predicted to be the best
year for exits, with the sole exception of 2007.
But the return to growth and soaring company valuations are
proving doubleedged for private equity funds, which are
collectively sitting on a record $1.07trn of so-called dry
powder – money provided by limited partnership (LP)
funds that they have been unwilling or unable to invest.
Those unspent funds, which are almost certain to grow over the
next few years, have been buoyed by the effects of quantitative
easing (QE) and represent the equivalent of three and a half
times the value of all private equity deals completed in 2013.
The situation faced in the Nordic nations, which have a...
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