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Private Equity

About Private Equity

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What is Private Equity?

Private equity is an alternate mode of private financing, which is composed of funds and investors that directly invest in private companies, What is Private Equity (PE)?or that engage in buyouts of public companies, resulting in the delisting of public equity. These companies are not listed or traded on any stock exchanges.
Private equity investors generally work towards funding new technology, making new acquisitions, expanding working capital and bolstering balance sheets of companies. Private Equity firms also work in the same manner like Venture Capitalists -- invest in the long term in startups to help them grow and then reap benefits after the companies go public or merge with other firms.
 
However, PEs are different as unlike Venture Capitalists who only invest in startups they invest in mature companies also that seek funds to improve their performance. Private Equities make money from management fees and also charge performance fees for sale or turnaround growth of the company.
 

How Private Equity works

Private equity raises funds from institutional investors and wealthy individuals to invest in various assets. PEs invest in stressed assets, in leveraged buyouts of companies with the intention of solidifying its balance sheet or taking it to IPO. PEs also invest in REITs, funding in real estate, and also in Venture Capital funds.
 

Advantages of PE

Private equity offers several advantages to companies and startups.
 
1. PEs are favoured by firms because it allows them access to liquidity as an alternative to conventional financial mechanisms, such as high interest bank loans.
 
2. Certain forms of private equity, such as venture capital, also finance ideas and early stage companies/startups.
 
3. In the case of companies that are delisted, private equity financing can help such firms attempt unusual growth strategies away from the eyes of markets, as these companies don't have the constant pressure of publishing their quarterly earnings.

Latest Updates on Private Equity

Net big from small and midcap exits

Updated On: 23 Dec 2024 | 12:04 AM IST

Existing investors Asian Development Bank (ADB) and British International Investment (BII) also participated in the round, which consists of a mix of primary and secondary transactions

Updated On: 10 Dec 2024 | 10:44 PM IST

Private equity has grown over the past few years, with an increasing number of firms turning to private credit as the main source of financing their deals

Updated On: 10 Dec 2024 | 7:31 PM IST

Experts feel that the sector will continue to attract $5-6 bn private capital annually

Updated On: 01 Dec 2024 | 10:33 PM IST

The fund, comprising $808 million in primary commitments and $210 million in pre-allocated co-investment, primarily focuses on healthcare and financial services in growth markets

Updated On: 26 Nov 2024 | 1:01 PM IST

Startup IPO boom reshapes their investment strategies

Updated On: 19 Nov 2024 | 10:51 PM IST

Bain Capital's Kotecha highlighted that the strongest indicator of PE's value is the long-term track record and measurable impact on portfolio companies

Updated On: 08 Nov 2024 | 11:13 PM IST

Investment leaders from Bain Capital, Samara Capital, BlackSoil Capital, and Multiples Alternate Asset Management speak about capital flow, business and startup growth at the BS BFSI Insight Summit

Updated On: 08 Nov 2024 | 1:51 PM IST

APAC private capital fundraising hits five-year low: Preqin report

Updated On: 31 Oct 2024 | 5:19 PM IST

The decline in overall investments happened despite the number of deals being 26 per cent higher during the same period at 283 transactions

Updated On: 18 Oct 2024 | 10:33 PM IST

Gaja Capital and Lok Capital have made the commitment, which will be utilised for fuelling the company's pan-India plans and also for a Rs 267-crore acquisition of Capital India Home Loans

Updated On: 17 Oct 2024 | 10:39 PM IST

The sharp fall in transaction value can be attributed to the absence of large-scale deals, said the Grant Thornton report

Updated On: 14 Oct 2024 | 5:41 PM IST

The PE inflows stood at $ 6.7 billion in 2019, $ 6.6 billion in 2020, $ 3.4 billion in 2021, $ 3.4 billion in 2022, and $ 3.9 billion in 2023

Updated On: 08 Oct 2024 | 4:12 PM IST

The majority of deals are priced at discounts of between 20 per cent to 25per cent of their net asset values, making them attractive for secondary buyers, said Amit Gupta, founding partner at TPG NewQ

Updated On: 07 Oct 2024 | 11:10 AM IST

Acquire 46.85% for Rs 846 cr; deal triggers open offer

Updated On: 27 Sep 2024 | 11:43 PM IST

The PE major has invested over $8 billion in the country through more than 30 deals, making it a force to reckon with. It has said it would invest around $5 billion this year in India

Updated On: 27 Sep 2024 | 2:12 PM IST

Country is leader in Asia Pacific for private debt, says investment data company

Updated On: 26 Sep 2024 | 11:38 AM IST

In its report released on Wednesday, real estate consultant Knight Frank India said the Private Equity (PE) investments in India's flexible office space sector have fluctuated significantly

Updated On: 25 Sep 2024 | 5:07 PM IST

Eris Lifesciences Ltd is a listed Indian pharmaceutical company and a leading player in the domestic branded formulations market

Updated On: 22 Aug 2024 | 8:50 PM IST

The amount of funds invested is 30 per cent higher than the July-December 2023 period, the report by industry lobby grouping IVCA and consultancy firm EY said

Updated On: 22 Jul 2024 | 10:45 PM IST