I feel like there's more to the story, but an interesting article from FT nonetheless:
Private equity has on average underperformed the stock market in the last decade, according to a detailed survey of the buy-out industry submitted to the European parliament yesterday.
The stereotype of private equity cutting costs at companies and making colossal profits from selling them soon afterwards was undermined by the research, compiled by an assistant professor of strategy at the HEC business school in Paris.
Based on data from 6,000 private equity deals and about 1,000 buy-out funds, the survey shows that average private equity returns have underperformed the benchmark S&P 500 share index by 3 per cent, after fees charged to investors.
Actually, the more interesting stuff is deeper in the article:
Mr Gottschlag admitted that some private equity firms were consistently outperforming the stock market. But he was sceptical about the number of buy-out funds that say they are "top quartile" in performance rankings.
On a more positive note for the industry, Mr Gottschlag said his research showed private equity firms were longer-term investors than many listed company shareholders. He also found they were more focused on growth than restructuring.
A comparison of buy-outs completed in 1996 and big minority shareholders in a broad selection of public companies found that, after five years, 55 per cent of private equity investors had sold out, against 88 per cent of minority shareholders.
Mr Gottschlag said a survey of 1,000 buy-out case studies found that 91 per cent of private equity groups had growth initiatives at the companies they bought, against only 54 per cent with restructuring initiatives.
"This suggests that buy-outs really fulfil a very important role of triggering a revitalisation of mature companies," he said.
The report also found that private equity-owned firms outperformed their listed peers and continued to do so after a buy-out firm had exited. "So I see no evidence that private equity harms the companies it invests in," he said.
di cui questo individuo cresciuto, lui o lei è diventata anche questa persona preparati su HIS / la sua terra. Parlare della circostanza inquietante, e mai così è stato Halloween. E 'stato prima il tipo di paesaggio orwelliano si può http://www.mycoachoutletstoreonline.com
Posted by: Coach Outlet Online | November 17, 2011 at 07:14 AM