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Private equity bosses bullish

posted Nov 9, 2009, 12:23 PM by Stacey Riggs   [ updated Nov 9, 2009, 12:24 PM by Yale ReiSoleil ]
Fund managers are optimistic for 2010

Four in five private equity fund managers expect to profit personally from their current funds, according to research among 120 senior private equity professionals.

Some 83 per cent of respondents anticipate receiving a share in the profits of their funds, known as carried interest, finds the research from Investec.

One year on from the collapse of Lehman Brothers, only 6 per cent of private equity professionals say their next fund will be smaller than their current one, while 37 per cent claim it will be bigger. However, the priority for the industry is managing current portfolios, as opposed to making new investments, seeking exits, or carrying out restructurings or refinancings, claims the study.

Simon Hamilton, an adviser at Investec, believes the research is good news for those who invest in private equity funds as well as for employees of private equity-owned companies.

Says Hamilton, ‘The UK private equity industry is in a relatively upbeat mood despite challenging market conditions. There is also an encouraging level of optimism about future fundraising abilities both in the near and long term.’

Respondents’ optimism extends to the wider economy, with 80 per cent expecting conditions to improve or remain the same over the next 12 months.

Respondents to Investec’s survey were mainly from mid-market firms, with 17 per cent of responses from professionals managing funds greater than £1 billion.

Source: Investec
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