Private equity deals could increase in the year ahead after a significant decline in activity in 2023, according to the latest report into this sector by Bain Capital.
Its data shows that private equity deal value fell by 37 per cent in 2023, while exit value fell by almost half. The figures from Bain Capital show fund-raising dropped across private capital, and 38 per cent fewer buyout funds closed.
Bain Capital’s annual private equity report said this was largely due to the sharp and rapid increase in central bank rates which caused the market to stall.
However it pointed out that in a year “of haves and have nots” dollar commitments in buyouts surged as a number of high-performing funds came to market.
Figures published in the Financial Times indicate that PE groups globally are sitting on a recover 28,000 unsold companies worth an estimated $3 trillion.
Ahead of its private equity report being published next week Bain Capital’s Global Private Equity practice chairman High MacArthur said that the year ahead may looks more optimistic, with interest rates appearing to have stabilised and “dry powder” among investors stacked and ready for deployment.
He adds: “Nearly half of all global buyout companies have been held for at least four years. In short, the conditions appear to be shifting in favour of hitting the go button. We will see what 2024 brings.”
